Pre-deposit and stay in service tax dispute over site installation work; complete waiver refused on prima facie classification grounds.

Prima facie classification of site installation activities as construction of civil structures and allied amenities for ATM installation weighed against complete waiver of pre-deposit. The appellant's own segregation of the contract for service tax on some components weakened the claim that the entire work was a turnkey works contract, and limitation was not found prima facie persuasive. Abatement was considered for interim relief in assessing likely tax liability. Complete waiver was declined; pre-deposit was directed within the stipulated time, and on compliance, stay operated for the balance demand, interest, and penalties.

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Issues: Whether the appellant was entitled to complete waiver of pre-deposit and stay of recovery in a service tax demand arising from site installation services, and whether a prima facie case was made out on classification, limitation, and abatement.

Analysis: The activities under the agreement were found, at the prima facie stage, to involve construction of civil structures and allied amenities for ATM installation. The contract had been separately split by the appellant for payment of service tax on some components, which weakened the plea that the entire activity was a turnkey works contract. The plea of limitation was also found not to be prima facie persuasive. At the same time, the request for abatement was considered for purposes of interim relief, and the likely tax liability was assessed on that basis.

Conclusion: Complete waiver was declined. The appellant was directed to pre-deposit Rs. 1,25,00,000 within the stipulated time, and subject to compliance, stay was granted for the balance demand, interest, and penalties.

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