Court waives interest deposit requirement for appeal under Section 35G of Central Excise Act. Tribunal instructed to expedite process.

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 as a pre-deposit condition for hearing the appeal on merits. The Tribunal was directed to expedite the appeal process.

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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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