Pre-deposit waiver in service tax dispute denied where admitted taxable services and weak prima facie case defeated full relief.

Total waiver of pre-deposit was refused because the applicant failed to establish a strong prima facie case against the service tax demand. The limitation plea on the franchisee service component did not prevail where the investigation record and admitted facts indicated representational rights granted to more than 100 centres for consideration, and where liability on other taxable services was not disputed. The authority noted that service tax had been collected without remittance in some instances. Conditional relief was granted by directing a pre-deposit of Rs. 1 crore, with the balance demand waived and recovery stayed pending appeal.

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Issues: Whether the applicant was entitled to total waiver of pre-deposit in respect of the service tax demand, including the plea that the franchisee service demand was time-barred.

Analysis: The demand arose from multiple taxable services and the principal component related to franchisee service. The applicant did not dispute liability on merits for that component and relied on limitation, but the statement recorded in the course of investigation only disclosed the activity and did not negate the subsequent findings of representational rights granted to more than 100 centres for consideration. The applicant also did not deny receipt of consideration for the other taxable services and, in some instances, had collected service tax without remitting it. On these facts, a case for total waiver of pre-deposit was not made out.

Conclusion: Total waiver was declined. The applicant was directed to pre-deposit Rs. 1 crore, and the balance demand was waived and recovery stayed pending the appeal.

Final Conclusion: The application for waiver was allowed only in part, with conditional relief granted against the remaining demand during the pendency of the appeal.

Ratio Decidendi: Where a party fails to establish a strong prima facie case and the demand is supported by admitted facts showing taxable services for consideration, total waiver of pre-deposit is not warranted.

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