Pre-deposit waiver for rent-a-cab service credit upheld on direct nexus with manufacture and stay of recovery granted

Delay in filing the appeal was condoned on acceptance of the reasons furnished. In the waiver application, a prima facie case was found for unconditional waiver of pre-deposit because binding precedent supported the claim that use of cabs to transport employees between residence and factory had a direct nexus with the business of manufacture. Recovery was stayed pending disposal of the appeal.

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Issues: Whether the appellant was entitled to condonation of delay, waiver of pre-deposit of the service tax and penalty, and stay of recovery pending appeal on the claim relating to Rent-a-Cab service credit.

Analysis: The delay in filing the appeal was condoned on acceptance of the reasons shown. On the waiver application, a prima facie case was found for unconditional waiver in view of the binding precedent relied upon, and the use of cabs for transporting employees between residence and factory was treated as having a direct relation to the business of manufacture.

Outcome: The delay condonation application was allowed. Pre-deposit of the service tax and penalty was waived and recovery was stayed pending disposal of the appeal.

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