2014 (4) TMI 883 - HC - Service Tax

Waiver of pre deposit - Held that - We have not the slightest doubt that having filed the proceeding before the tribunal, the petitioner ought to have pursue the same with all seriousness. Repeated adjournments were neither justified nor can be found and fault with the tribunal in not adjourning the proceedings time and again. Nevertheless, in facts of the case when it is pointed out to us that at-least on the last occasion the reason pressed was sickness of representative of the petitioner and when by an ex-parte order, pre-deposit of sizeable amount of ₹ 1 crore came to be imposed, in our opinion, the petitioners deserve one last opportunity to argue the petition for waiver of pre-deposit on merits before the tribunal. This however, cannot be done unconditionally. The petitioner must pay reasonable heavy cost for availing such an opportunity. In facts of the case, therefore, orders dated 2.8.2013 and 3.12.2013 passed by the tribunal are set aside, the proceedings are placed back before the tribunal for consideration on merits and disposal in accordance with law. For such purpose, tentatively we fix the date of 21.4.2013 before the tribunal. This is only in order to ensure that no fresh notice shall have to be served to the parties of such proceedings. It is made abundantly clear that if on such date the tribunal wishes to reschedule the hearing, it would be absolutely open for the tribunal to do so - Decided partly against assessee.

Summary

Issues:
Challenge to orders passed by Customs, Excise and Service Tax Appellate Tribunal regarding pre-deposit proceedings.

Analysis:
The petitioners challenged orders dated 22.8.2013 and 3.12.2013 passed by the Customs, Excise and Service Tax Appellate Tribunal arising from pre-deposit proceedings. The tribunal proceeded ex-parte against the petitioner due to repeated adjournment requests. The tribunal required a pre-deposit of Rs. 1 crore, which the petitioner sought to recall through a Misc. Application, but was rejected. The High Court acknowledged the seriousness of pursuing the proceedings but noted the reason for the last adjournment was the sickness of the petitioner's representative. The Court granted the petitioners one last opportunity to argue for waiver of pre-deposit before the tribunal, subject to paying a reasonable heavy cost for availing this chance.

The High Court set aside the orders passed by the tribunal and placed the proceedings back before the tribunal for consideration on merits and disposal in accordance with the law. A tentative date of 21.4.2013 was fixed for the tribunal to hear the case, ensuring no fresh notices need to be served. The Court emphasized that the tribunal could reschedule the hearing if needed. The petitioner was directed to deposit Rs. 50,000 with the Gujarat State Legal Services Authority by 31.3.2014. Finally, the petition was disposed of by the High Court.