Pre-deposit direction modified in service tax appeal, with bank guarantee accepted and merits hearing directed.

In a service tax appeal, the pre-deposit direction was modified by permitting the petitioner to secure the demand with a bank guarantee from a nationalised bank to the Commissioner's satisfaction. Once the guarantee was furnished, the Tribunal was directed to hear and decide the appeal on merits within six months and to pass an appropriate order regarding the guarantee. The modification replaced the original pre-deposit requirement with a conditional security arrangement, enabling substantive appellate hearing.

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Issues: Whether the impugned pre-deposit direction in the service tax matter should be modified and the appeal directed to be heard on merits on furnishing a bank guarantee.

Outcome: The order was modified by requiring the petitioner to furnish a bank guarantee of Rs. 50 lakhs of a nationalised bank to the satisfaction of the Commissioner, after which the Tribunal was directed to hear and decide the appeal on merits within six months and make an appropriate order regarding the bank guarantee.

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