Partial pre-deposit in service tax stay proceedings granted where liability was disputed and recovery stayed on compliance.

In service tax stay proceedings, the Tribunal balanced the disputed liability and the appellant's non-compliance history by requiring only a partial pre-deposit, with the balance waived and recovery stayed on compliance. The order noted that the appellant had registered, stopped filing returns and paying tax, and had not deposited any amount after adjudication, while the quantum of liability remained disputed because abatement was said not to have been allowed for later years. The ruling was confined to interim stay conditions and did not decide the merits of the service tax demand.

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Issues: Whether, in the stay proceedings, the appellant was required to pre-deposit the entire disputed service tax, interest and penalty or whether a partial pre-deposit with waiver of the balance was justified.

Analysis: The demand arose in service tax proceedings and the order was confined to the application for stay and waiver of pre-deposit. The appellant had taken registration, stopped filing returns and paying tax, and had not deposited any amount even after the adjudication order. At the same time, the calculation of liability was disputed on the ground that abatement had not been allowed for the later years. For the purpose of securing the appeal and balancing the competing considerations, the required pre-deposit was reduced to a partial amount, with the balance to remain stayed during the pendency of the appeal upon compliance.

Conclusion: The appellant was directed to make a partial pre-deposit of Rs. 1.5 lakh, and on such compliance, waiver of the balance pre-deposit and stay of recovery was granted.

Final Conclusion: The order finally determined only the interim stay conditions in the appeal and did not decide the merits of the service tax demand.

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