2010 (1) TMI 680 - AT - Service Tax

Application of stay - Waiver of pre-deposit - only the insolvency petition filed by the appellant stands dismissed by the Principal Civil Judge on 7-11-2009 Income tax returns of the appellants show that they are not insolvent - in the interest of justice the appellants are allowed to pre-deposit the required amount of Rs. 10, 00, 000/- by 26-2-2010 - Decided against the assessee by way of direction to deposit Rs. 10 Lakhs

Summary

Issues:
1. Restoration of stay order dated 6-2-2008.
2. Insolvency petition dismissal and income tax returns showing non-insolvency status.
3. Waiver of pre-deposit requirement.
4. Compliance deadline for pre-deposit amount.

The Appellate Tribunal CESTAT, Bangalore, considered a case where a stay petition was heard on 6-2-2008, requiring a pre-deposit of Rs. 10,00,000 against a duty demand of Rs. 2,26,09,375 and equivalent penalty. Subsequently, a miscellaneous application was allowed by the same Bench on 11-8-2008, waiving the pre-deposit requirement due to an insolvency petition. The Jurisdictional Commissioner filed a new miscellaneous application seeking restoration of the earlier stay order dated 6-2-2008, stating that the insolvency petition had been dismissed, and the appellant's income tax returns indicated non-insolvency status.

The Tribunal noted that the ground for waiving the pre-deposit no longer existed, leading to the recall of the Stay Order dated 11-8-2008 and restoration of the Original Stay Order dated 6-2-2008. However, in the interest of justice, the appellants were given until 26-2-2010 to pre-deposit the required amount of Rs. 10,00,000, with compliance to be reported by 1-3-2010. Subject to this compliance, the pre-deposit requirement for the balance amount was waived during the appeal's pendency. The decision was dictated and pronounced in an open court session.