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of <h1>Tribunal Remands Appeal for Tax Compliance Discrepancy</h1> <h3>M/s AAHLUWALIA CONTRACTS INDIA LTD Versus COMMISSIONER OF CENTRAL EXCISE, NOIDA</h3> The Tribunal set aside the order dismissing the appeal for non-compliance due to the appellant having discharged the service tax liability on mobilization ... Waiver of pre deposit - civil and industrial construction and construction of residential complexes services - Held that:- From the findings of the Commissioner (Appeals), it appears that the appellant have discharged service tax liability on the mobilization advance and the dispute would be only as to whether, the service tax should have been paid as and when the mobilization advance was received or whether the same should have been paid when the advance was adjusted during the course of execution of the project. As such, the dispute would be only of the interest for the period of delay in discharge of tax liability. In view of this, the impugned order directing the appellant to deposit 50% of service tax demand of ₹ 42,26,430/- is too harsh. The impugned order, therefore, is set aside and the matter is remanded to the Commissioner (Appeals) for deciding the appeal on merits without insisting on pre-deposit - Decided in favour of assessee. Issues: Service tax liability on mobilization advance, delay in payment of service tax, pre-deposit requirement, appeal dismissal for non-compliance.Analysis:1. Service Tax Liability on Mobilization Advance:The appellant, engaged in civil and industrial construction services, received 10% mobilization advance for projects but discharged service tax liability only when the amount was adjusted during project execution, not upon receipt. The jurisdictional Addl. Commissioner confirmed a service tax demand for the period 2006-07 to 2010-11, along with interest and penalty under the Finance Act, 1994.2. Delay in Payment of Service Tax:The Commissioner (Appeals) directed the appellant to deposit 50% of the service tax demand, but the appellant failed to comply within the stipulated period. Consequently, the appeal was dismissed for non-compliance without delving into the case's merits.3. Pre-Deposit Requirement:The appellant argued that they had already discharged the service tax liability on mobilization advance and should not be required to pre-deposit 50% of the demand. The impugned order was challenged on the grounds that the demand for pre-deposit was excessive given the circumstances.4. Appeal Dismissal for Non-Compliance:After considering submissions from both sides, the Tribunal found that the appellant had indeed discharged the service tax liability on mobilization advance, leading to a dispute over the timing of payment. The Tribunal set aside the impugned order, remanding the matter to the Commissioner (Appeals) for a decision on the appeal's merits without insisting on pre-deposit, thereby disposing of the stay application and appeal accordingly.
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