2010 (10) TMI 542 - AT - Service Tax

Waiver of pre-deposit - Refund - The amount which is ordered to be recovered was released in favour of the appellants in terms of CBEC Circular No. 828/05/2006-CX dated 20-4-2006 which permitted the prevailing amount of 80% of the claim filed in case of reputed exporters without carrying out any verification - Already there is prima facie finding that no amount of services had been rendered outside India and entire services was rendered in India and therefore the appellants were directed to deposit a sum of Rs. 70 crores in the said case - The appellants have no prima facie case applying the ratio laid down by the Apex Court in relation to the matter pertaining to stay of order impugned in that case - Do not find any prima case having been made for total waiver of the amount demanded in the impugned order - However waive the appellants to deposit the interest amount.

Summary

Issues:
1. Stay application filed by the appellant in relation to the rejection of refund claim.
2. Recovery of erroneously paid amount released to the appellant.
3. Overlapping issues with a previous case related to Cenvat credit accumulation.
4. Prima facie case for stay of the impugned order.
5. Adverse findings against the appellant regarding services rendered in India.
6. Decision on waiver of interest amount and direction to deposit the duty amount.

Analysis:

1. The appellant filed a stay application concerning the rejection of a refund claim amounting to Rs. 79,02,352/- and Rs. 97,99,271/-, leading to the recovery of Rs. 63,21,881/- and Rs. 68,07,174/- along with interest, as per the order passed by the Commissioner, New Delhi on 8-3-2010.

2. The amount ordered to be recovered was initially released to the appellant based on a circular allowing 80% of the claim without verification for reputed exporters. However, subsequent investigation revealed that the payment was made erroneously.

3. The appellant's counsel referred to a previous case involving similar issues related to Cenvat credit accumulation, requesting the present matter to be listed for hearing along with the previous case, emphasizing the overlap in issues and the upcoming final hearing on 7-12-2010.

4. The Departmental Representative argued against a prima facie case for stay, citing a Supreme Court decision and previous judgments indicating that services were rendered in India, leading to a directive for the appellant to deposit Rs. 70 crores in a related case.

5. It was acknowledged that the disputed refund claim pertained to Cenvat credit for services rendered in India, with adverse findings against the appellant indicating that services were provided within the territory of India, resulting in the directive to deposit Rs. 70 crores, a decision upheld by the High Court.

6. Considering the investigative findings and the confirmed decision in the main matter, the Tribunal found no prima facie case for a total waiver of the demanded amount but waived the interest amount until the appeal's disposal. The appellant was directed to deposit the duty amount within six weeks, with the matter scheduled for listing alongside related appeals on 7-12-2010.