By TIOL News Service

NEW DELHI, AUGUST 10, 2013: AN appeal was preferred by the petitioner before the Commissioner(A) against the o-in-o confirming a service tax liability of Rs.18,68,165/- and imposing penalty and interest.

The lower appellate authority had ordered the appellant to make a pre-deposit of 20% of the tax amount but since the appellant failed to do so, the appeal was rejected.

Before the CESTAT the appellant submitted that due to financial constraints they could not make the pre-deposit. So, the CESTAT disposed of the appeal by allowing the appellant a further period of six weeks to pre-deposit the same and report compliance to the Commissioner(A) who would thereafter dispose of the appeal on merits after following the principles of natural justice.

Pursuant to this order, the appellant complied and the Commissioner(A) decided the case - inasmuch as he confirmed the demand including the penalties except that imposed u/s 76 by the adjudicating authority.

Against this order the appellant had preferred an appeal before the CESTAT and the same was disposed of on 13.2.2013 directing the petitioner to deposit Rs.5 lakhs as a condition for grant of waiver of pre-deposit of the adjudicated tax amount.

Now, the appellant is again before the CESTAT seeking a recall/review of the stay order.

It is submitted that the present order of the CESTAT directing deposit of Rs.5 lakhs in the context of the earlier final order of the Tribunal wherein they were directed to pre-deposit 20% of the adjudicated tax liability is contrary to the judgment of High Court of Delhi in   Super Tyres Ltd. vs. UOI - (2005-TIOL-228-HC-DEL-CX) and the order of the Tribunal in Hotline Display Devices Limited vs. C.C.E., Noida - (2007-TIOL-1972-CESTAT-DEL).

The Bench held that the contentions of the appellant do not commend acceptance because - The decision of Delhi High court in Super Tyres Ltd (supra) was in a different factual context. The facts in Super Tyres Ltd. require to be noted for identifying the distinct factual matrix. Appeal to this Tribunal was preferred against the adjudication order dated 25.10.2004. This Tribunal disposed of the application for waiver of central excise duty and directed deposit of Rs.20 lakhs as a condition for hearing the appeal, under Section 35 F of the Central Excise Act. Earlier Super Tyres Ltd. had preferred an appeal wherein a similar application for waiver of pre-deposit was disposed of directing deposit of Rs.20 lakhs and that appeal was disposed of remitting the matter for de novo adjudication by the assessing officer. Thereafter the assessing officer reconfirmed his earlier order. Against the latter order of the assessing officer, the assessee preferred a fresh appeal and the Tribunal again directed the appellant to deposit Rs.20 lakhs as a condition for waiver of pre-deposit. In these circumstances, the Delhi High Court held that the same demand having been reiterated and assessed against the petitioner, it would improper for the appellate Tribunal to direct deposit of a further amount. The High Court observed that the appeal should have been heard without directing a further pre-deposit, as the assessee had earlier deposited Rs.20 lakhs, in the earlier appeal.

Holding that there is no violation of the decision of the Delhi High Court in Super Tyres Ltd. (and identical order passed in Hotline Display Devices Ltd) the Bench dismissed the Miscellaneous Application as being devoid of merits. The appellant was allowed a further period of two weeks to make the pre-deposit and report compliance and in the event of failure to do so the appeal would be rejected, said the Bench.

(See 2013-TIOL-1199-CESTAT-DEL)