Tribunal grants condonation for appeal delay, clarifies SEZ service tax exemption as refund

The Tribunal granted condonation of a 6-day delay in filing the appeal due to the proprietor's illness. Regarding the service tax on rent-a-cab services to SEZ units, the Tribunal clarified that the exemption is in the form of a refund, requiring initial tax payment. An amount of approximately Rs. 6,15,000 was involved for the year 2010-2011. The Tribunal directed the appellant to deposit Rs. 5,00,000 as a pre-deposit within eight weeks and granted a stay against recovery upon compliance.

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Issues: Condonation of delay in filing appeal, Service tax on rent-a-cab service to SEZ units, Exemption for SEZ units, Pre-deposit amount determination, Stay against recovery

Condonation of Delay in Filing Appeal:
The appellant sought condonation of a 6-day delay in filing the appeal, attributing it to the proprietor's illness. The Tribunal, satisfied with the reason provided, granted the condonation.

Service Tax on Rent-a-Cab Service to SEZ Units:
The appellant provided rent-a-cab services to SEZ units for use within the SEZ. The Tribunal noted that the procedure followed by the appellant in providing the service without payment of service tax was incorrect. It clarified that the exemption for services utilized by SEZ units is in the form of a refund, necessitating the initial payment of tax. The Tribunal found that for the year 2010-2011, an amount of approximately Rs. 6,15,000 was involved. Considering the exemption available but by way of refund, it opined that if the appellant deposits the amount payable for the normal period, it would be sufficient.

Exemption for SEZ Units:
The Tribunal emphasized that the exemption for SEZ units is through refund, requiring the initial payment of tax. It highlighted that the bulk of the demand was for the extended period, and the amount within the normal period could not be precisely determined. However, for the year 2010-2011, an amount of around Rs. 6,15,000 was identified. The Tribunal directed the appellant to deposit Rs. 5,00,000 towards pre-deposit within eight weeks and report compliance by a specified date.

Pre-deposit Amount Determination:
Considering the facts and circumstances, the Tribunal directed the appellant to deposit Rs. 5,00,000 as a pre-deposit amount within a specified timeframe. It noted that the appellant had already paid Rs. 2 lakhs. Upon compliance with this requirement, the Tribunal waived the balance dues and granted a stay against recovery.

Stay Against Recovery:
Subject to the appellant's compliance with the pre-deposit requirement, the Tribunal waived the balance dues and granted a stay against recovery. The operative portion of the order was pronounced in open court, ensuring clarity and immediate effect.

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