Prima facie challenge to service tax notice justified complete waiver of pre-deposit where return filing arose under Section 71A.

A prima facie challenge to a show cause notice under Section 73 of the Finance Act, 1994 was accepted because the return-filing obligation in the relevant category arose under Section 71A. The Tribunal held that the Revenue's relied-upon refund precedent involved a different factual and legal setting and was not controlling. Applying L.H. Sugar Factories Ltd., it found the appellant's objection sufficient to justify waiver of pre-deposit, and granted complete waiver of tax and penalty pre-deposit.

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Issues: Whether the appellant had made out a prima facie case for waiver of pre-deposit of service tax and penalty, in view of the challenge to the show cause notice issued under Section 73 of the Finance Act, 1994 where the liability to file return arose under Section 71A of the Finance Act, 1994.

Analysis: The Tribunal noted that the earlier decision relied upon by the Revenue concerned refund of service tax and turned on a different factual and legal setting. The present matter involved recovery proceedings under Section 73 of the Finance Act, 1994, while the obligation to file the return in the relevant category arose only under Section 71A of the Finance Act, 1994. In these circumstances, the Tribunal considered the ruling in L.H. Sugar Factories Ltd. applicable and treated the appellant's objection to the notice as sufficient to establish a prima facie case.

Conclusion: The appellant succeeded in obtaining waiver of the entire pre-deposit of tax and penalty.

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