Pre-deposit sufficiency for appeal admission and stay of recovery where service tax issues remained unsettled.

The deposit already made was treated as sufficient for admission of the appeal and for interim stay of recovery pending disposal. The Tribunal noted that the dispute involved abatement under a service tax exemption notification in cases of free supply of materials, and the availability of the works contract scheme where the commencement of work and the date of service tax payment were in issue. Relying on an existing Tribunal decision favouring the assessee on free supply materials and the reference of the other issue to a Larger Bench, the pre-deposit was accepted at the interim stage and recovery was stayed.

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Issues: Whether the deposit already made was sufficient for admission of the appeal and grant of stay of recovery pending disposal of the appeal.

Analysis: The dispute raised contentious questions on abatement under the service tax exemption notification in cases involving free supply of materials, and on the availability of the works contract scheme where the commencement of work and the date from which service tax was paid were in issue. In view of an existing Tribunal decision in favour of the assessee on free supply materials and the reference of the other issue to a Larger Bench, the amount already deposited was considered adequate at the interim stage.

Conclusion: The deposit already made was held sufficient for admission of the appeal, and recovery of the disputed dues was stayed till disposal of the appeal.

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