Port services and CENVAT credit dispute justified stay of recovery pending appeal after sufficient deposit was made.

Interim protection was granted against recovery of the balance service tax, interest and penalties because the dispute on port services and CENVAT credit required detailed adjudication. The appellant relied on decisions suggesting that port-related charges such as royalty, rent and allied recoveries did not fall within port services for the relevant period, while both sides cited authorities on admissibility of input service credit. As the nature of the controversy and the deposits already made were considered sufficient, coercive recovery of the remaining dues was stayed until disposal of the appeal.

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Issues: Whether recovery of the remaining service tax demand, interest, and penalties should be stayed pending disposal of the appeal in view of the nature of the dispute and the amount already deposited.

Analysis: The disputed demand included a substantial amount under the head of port services and the admissibility of CENVAT credit on input services was also contested. The appellant relied on authorities holding that certain port-related charges such as royalty, rent, and allied recoveries did not fall within port services for the relevant period. On the credit issue, both sides cited decisions supporting their respective positions, showing that the matter required detailed adjudication. In the circumstances, the deposits already made were treated as sufficient for granting interim protection against coercive recovery of the balance dues.

Conclusion: The application for stay was allowed and recovery of the remaining dues and penalties was stayed till disposal of the appeal.

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