Pre-deposit waiver in service tax coaching dispute limited where exclusion of study material value lacked supporting evidence.

Waiver of pre-deposit in a service tax dispute on commercial coaching service was refused in part because the assessee failed to produce specific evidence that the study material was not sold only to coaching students. On the material before it, the Tribunal held that the value of such material could not be excluded from the consideration for coaching service, and full waiver was therefore not justified. It directed a partial pre-deposit of Rs. 3 lakhs and granted stay of recovery of the balance during pendency of the appeal, subject to compliance.

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Issues: Whether waiver of pre-deposit could be granted in respect of service tax demand on commercial coaching service, including the value of study material sold to students.

Analysis: The appellant sought exclusion of the value of study material from the taxable value on the basis of the exemption notification and contended that pre-deposit should be waived. The Tribunal found that the appellant had not produced specific evidence to show that the study material was not sold only to coaching students, and therefore the price of such material could not be excluded from the consideration for the coaching service on the material placed before it. In the absence of such evidence, the request for complete waiver was not able. Applying the established principles governing pre-deposit, the Tribunal directed a partial deposit and granted stay of the balance recovery during pendency of the appeal upon compliance.

Conclusion: Waiver of pre-deposit was declined in part and a deposit of Rs. 3 lakhs was directed, with stay of recovery of the balance on compliance.

Final Conclusion: The interim relief was restricted to a conditional stay after partial pre-deposit, and the appellant did not obtain full waiver.

Ratio Decidendi: Full waiver of pre-deposit is not warranted where the assessee fails to adduce specific evidence supporting exclusion of the disputed amount from the taxable value.

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