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TMI Blog2011 (10) TMI 392X X X X Extracts X X X X X X X X Extracts X X X X ..... bstantial questions of law : 4.1 Whether in the facts and circumstances of the case, the CESTAT was justified in directing Appellant to deposit a sum of Rs . 50 lakhs towards penalty under Section 83 of the said Act read with 35F of the Central Excise Act, 1944? 4.2 Whether in the facts and circumstances of the case, CESTAT was justified in directing further deposit of Rs . 50 lakhs for the purposes of entertaining the Appellant s appeal on merits even though admittedly 99% of the service tax demand had been paid by the Appellant ? 4.3 Whether in the facts and circumstances of the case, CESTAT was correct in ignoring Section 80 of the said Act (which provides no penalty be imposed if there was a reasonable cause for breach of any provisi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... l dues which ought to have been demanded was only Rs.28.64 lakhs being the difference between the total amount due of Rs . 5.85 crores and Rs . 5.57 crores which was the service tax admittedly paid. According to the Appellants if the amount due was only Rs . 28.64 lakhs, the adjudication would have to be before the Additional Commissioner of Central Excise under the relevant notification and they would have been entitled to a right of appeal before the Commissioner. The Appellants, however, stated that they did not desire to litigate the matter any further. Accordingly, they sought to avail of the benefit under Section 73( 1A ) of the Finance Act, 1994. In order to do so, the Appellants stated that they had paid the entire amount of Rs . 28 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of Rs . 7 lakhs towards penalty, they were further directed to pay Rs . 50 lakhs towards the penalty. 7. Learned Counsel appearing on behalf of the Appellants submitted that the Appellants were entitled to the benefit of Section 73 ( 1A ) and had in fact complied with the statutory provision. Learned Counsel submitted that the Appellants paid almost 99% of the service tax dues besides 25% of the penalty and interest as required in law. In these circumstances, he submitted that the Appellant ought to have been granted waiver from the requirement of depositing a sum of Rs . 50 lakhs. 8. On the other hand, learned Counsel appearing on behalf of the Respondents sought to place reliance on the order of the Tribunal and submitted that no case ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pay service tax dues. While seeking the benefit of Section 73( 1A ), the Appellants claim to have paid duty in the amount of Rs . 78.64 lakhs, 25% of the penalty payable on the aforesaid amount and interest. Whether the Appellant has in fact fulfilled the requirement of Section 73 ( 1A ) is a matter which will fall for determination before the Tribunal in the pending appeal. From the record before the Court, it appears from the order of the Tribunal that the Appellants had by their stay application sought a waiver of a predeposit of an amount of Rs . 14,61,843/being the balance amount payable towards service tax and of the penalty. The Tribunal has directed the Appellants to deposit an amount of Rs . 50 lakhs. We are of the view that havin ..... X X X X Extracts X X X X X X X X Extracts X X X X
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