Appellant ordered to deposit Rs. 1,00,000 with pre-deposit waiver, recovery stayed pending appeal. Service tax liability under scrutiny.

The Tribunal directed the appellant to deposit Rs. 1,00,000 within four weeks, with the balance pre-deposit waiver allowed subject to compliance, and recovery stayed until the final disposal of the appeal. The case centered on the correct calculation of service tax liability concerning running bills, mobilization advance, and adjustments, with the Tribunal noting the need for further examination before final resolution.

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Issues:
Calculation of service tax liability on running bills and mobilisation advance, adjustment of advance against service tax liability, interpretation of relevant legal provisions and case laws.

Analysis:
The appellant filed a stay petition seeking the waiver of pre-deposit of Rs. 4,03,827 confirmed as service tax and penalty under the Finance Act, 1994. The adjudicating authority confirmed the amounts as service tax liability, interest, and penalties related to Commercial or Industrial Construction Services. The appellant's counsel argued that the service tax liability was discharged correctly by adjusting mobilisation advance against running bills. The department, however, calculated the liability differently, resulting in a significant difference of Rs. Four lakhs, which was confirmed. The counsel referred to Section 66B, statutory definition of taxable services, and relevant case laws to support their argument that tax liability should be calculated based on when services are rendered. The departmental representative cited a Tribunal decision to justify their calculation method.

Upon considering the submissions, the Tribunal identified the key issue as the correct calculation of service tax liability when services are rendered and bills are raised, along with the adjustment of advance amounts against service tax liability. The Tribunal noted that the department's calculations seemed relevant based on a previous decision but acknowledged the lack of consideration for the mobilisation amount received by the appellant. The Tribunal deemed further examination necessary at the final appeal disposal. As a result, the appellant was directed to deposit Rs. 1,00,000 within four weeks, with the balance pre-deposit waiver allowed subject to compliance, and recovery stayed until the appeal's final disposal.

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