Pre-deposit order after prima facie case in favour of assessee - High Court allows appeal by assessee
IN yesterday's DDT, we reported an interim order of the Tribunal ordering pre-deposit of service tax with interest, in spite of recording a finding that there is a prima facie case against the demand. The assessee filed an appeal against the order of the CESTAT in the High Court of Delhi and the High Court held:
It is clear (from the findings) that the tribunal has observed that they were persuaded to follow the interim order passed in the case of Kaveri Agri Care Pvt. Ltd
In spite of the said observations and findings, the tribunal in the last paragraph i.e. paragraph 12 has stated as under:
"On the aforesaid analyses, we grant waiver of pre-deposit and stay all further proceedings pursuant to the adjudication orders impugned in these two appeals; on condition that the petitioner remits Rs.2,83,04,550/- plus proportionate interest on this amount in ST Appeal No.57100/2013; and the petitioner in ST Appeal No.57667/2013 shall remit Rs.66,77,289/- along with proportionate interest therein, within six weeks from today and report compliance by 5.11.2013. In default, the appeals shall stand dismissed for failure of pre-deposits ."
In view of the findings recorded by the tribunal reproduced above, we feel that the appellant is entitled to complete waiver of pre-deposit. The question of law is accordingly answered.
Interim orders directing to pre-deposit will have far reaching consequences as the adjudication by the department has become a religious confirmation of demands, many a time influenced by the amount of duty/tax involved. And the Tribunal is considered as the first forum where one can expect justice - this should not be shifted to the High Courts.