Reverse charge service tax dispute over IFC services: substantial deposit accepted, remaining pre-deposit waived and recovery stayed.

Services received from the International Finance Corporation were treated as subject to service tax on reverse charge basis, but the governing enactment was read as providing exemption from duties and taxes for such services. Because the appellant had already deposited a substantial part of the demand, that deposit was considered adequate for hearing the appeal. The remaining pre-deposit was waived and recovery of the balance demand was stayed pending disposal of the appeal.

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Issues: Whether the appellant was entitled to waiver of pre-deposit and stay of recovery where the service tax demand arose from services received from the International Finance Corporation and exemption from duties and taxes was claimed under the governing enactment.

Analysis: The amount in dispute was confirmed on reverse charge basis in relation to services received from the International Finance Corporation. The governing enactment was treated as exempting duties and taxes on such services, and the appellant had already deposited a substantial portion of the demand. On that basis, the deposited amount was considered sufficient for hearing of the appeal.

Conclusion: Pre-deposit of the remaining dues was waived and recovery of the balance demand was stayed during the pendency of the appeal.

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