Exemption claim and unclear service bifurcation supported waiver of pre-deposit pending appeal in service tax dispute.

Pre-deposit was waived pending appeal because the appellant raised a prima facie claim to exemption under Notification No. 13/2003-S.T. for commission agency service, and the adjudicating authority had not clearly bifurcated the activities into separate taxable categories. The Tribunal noted that the denial of exemption was based on a compendious view of multiple activities rather than a clear finding on each service head, and that the notification did not impose the condition relied on by the Revenue. On that basis, interim relief was granted during the pendency of the appeal.

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Issues: Whether pre-deposit should be waived pending appeal where the exemption notification was pleaded to apply and the adjudicating authority had not clearly bifurcated the activities into different taxable categories.

Analysis: The appellant relied on the exemption under Notification No. 13/2003-S.T. and contended that its activities were essentially commission agency service for the relevant period. The Revenue opposed the claim on the ground that the appellant had undertaken multiple activities not confined to commission agency service. The Tribunal noted that the Commissioner had not recorded a clear finding segregating each activity under distinct service categories and had proceeded on a compendious view to deny the exemption. In the absence of any condition in the notification and without a clear bifurcation of activities, a prima facie case was made out for interim relief.

Conclusion: Pre-deposit was waived during the pendency of the appeal.

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