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of <h1>Court waives interest deposit requirement for appeal under Section 35G of Central Excise Act. Tribunal instructed to expedite process.</h1> <h3>M/s Punjab Chemicals & Crop Protection Ltd. Versus Commissioner, Central Excise, Chandigarh-II, Chandigarh</h3> The Court allowed the appeal under Section 35G of the Central Excise Act, 1944, ruling that the deposit of interest component should not be insisted upon ... Waiver of pre deposit - tribunal ordered pre-deposit of interest amount - Held that:- Tribunal while deciding the issue regarding the pre-deposit had noticed that there was a prima facie case though not a strong prima facie case and after delving into the issue had waived the pre-deposit and stayed all further proceedings for realization of the adjudicated liability in terms of the impugned order but the element of interest which was consequential to the adjudicated liability was ordered to be paid on the service tax assessed. Once the realization of the principal liability was stayed and condition of pre-deposit was waived off, it would not be proper to direct that the entire interest component on the service tax assessed be deposited as a condition precedent for hearing of the appeal - order of tribunal modified - stay granted. Issues:Appeal under Section 35G of the Central Excise Act, 1944 for modification of the Tribunal's order regarding service tax liability, interest, and penalty.Analysis:The appellant appealed the order passed by the Tribunal confirming a service tax demand and imposing penalty and interest. The appellant contended that the Tribunal, while waiving the pre-deposit of the principal liability, imposed a condition to pay the interest component on the service tax assessed. The appellant argued that once the pre-deposit was waived, the interest should also have been waived. The respondent, however, supported the Tribunal's decision. The Court noted that the Tribunal had waived the pre-deposit based on a prima facie case but had ordered the payment of interest on the service tax assessed. The Court held that once the principal liability pre-deposit was waived, it was not appropriate to demand the entire interest component as a condition for hearing the appeal. Consequently, the Court allowed the appeal, ruling that the deposit of interest component should not be insisted upon as a pre-deposit condition for hearing the appeal on merits. The Tribunal was directed to expedite the appeal process.
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