Pre-deposit waiver in abatement dispute restricted after input service tax credit was availed; balance recovery stayed on compliance.

Denial of abatement under Notification No. 1/2006 was examined against the appellant's claim for total waiver of pre-deposit. Because the appellant had already availed credit of service tax on input services, the Tribunal held that complete waiver was not justified. It confined the pre-deposit to the amount corresponding to the credit availed, directed deposit of Rs. 6,72,000 within eight weeks, and granted waiver of the balance with stay of recovery during the appeal on compliance.

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Issues: Whether the appellant was entitled to total waiver of pre-deposit in respect of the demand arising from denial of abatement under Notification No. 1/2006 dated 01.03.2006.

Analysis: The appellant had availed credit of service tax paid on input services, and therefore the Tribunal held that a case for complete waiver of the dues adjudged was not made out. At the same time, the Tribunal restricted the pre-deposit to the amount representing the credit availed and directed deposit of Rs. 6,72,000 within eight weeks, with waiver of the balance and stay of recovery during the pendency of the appeal upon compliance.

Conclusion: Total waiver was denied, but partial waiver was granted by confining the pre-deposit to Rs. 6,72,000 and staying recovery of the remaining demand.

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