Input service credit for statutory construction obligations led to waiver of pre-deposit pending appeal.

Pre-deposit of duty and penalty was waived pending appeal where credit was denied for construction of a Kisan Shade and Labour Hutment. The tribunal treated the structures as prima facie linked to business activity because they were stated to be statutory obligations under the applicable law. Relying on the cited larger bench view on input service credit, it found that insisting on pre-deposit was unnecessary at that stage and granted stay till disposal of the appeal.

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Issues: Whether pre-deposit of duty and penalty should be waived pending appeal.

Analysis: The claim concerned denial of credit in respect of construction of Kisan Shade and Labour Hutment. The order noted that these structures were stated to be statutory obligations under the applicable law and treated the activity as prima facie connected with business. On that basis, and in light of the cited larger bench view on input service credit, the requirement of pre-deposit was found unnecessary at this stage.

Conclusion: Pre-deposit of duty and penalty was waived till disposal of the appeal and the stay application was allowed.

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