Pre-deposit waiver in service tax dispute limited by a new notification claim raised only at the stay stage.

At the stay stage, a new claim for notification benefit could not be entertained where it had not been raised before the lower authority and the original dispute was limited to taxability on commission retained after amounts were passed on to customers. On that record, a prima facie case for complete waiver of pre-deposit of service tax and penalties was not established. Partial waiver was therefore granted, subject to further deposit of the specified amount, with the balance pre-deposit waived upon compliance.

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Issues: Whether the applicants were entitled to waiver of pre-deposit of the disputed service tax and penalties, and whether the newly raised claim to notification benefit could be considered at the stage of stay.

Analysis: The claim of notification benefit had not been raised before the lower authority, whereas the issue before that authority was confined to taxability on the commission retained by the applicants after passing on a part to customers. In view of the limited plea and the record before the lower authority, a prima facie case for full waiver of pre-deposit was not made out.

Outcome: Partial waiver of pre-deposit was granted on condition of deposit of Rs. 1,50,000 in addition to the amount already deposited, with waiver of the balance pre-deposit upon compliance.

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