Appellants challenge service tax on job work assembly, Tribunal remands for reconsideration without pre-deposit.

The appellants, involved in job work assembling items using inputs from their principal, disputed liability for service tax. Despite arguments that the activity constituted "manufacture" under the Central Excise Act, authorities upheld the tax demand, interest, and penalties. The Commissioner (Appeals) initially rejected the appeal due to non-deposit of the tax amount. However, the Tribunal later set aside this decision, remanding the matter for reconsideration without the need for pre-deposit of penalties, given that the service tax and interest had already been paid.

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Issues:
1. Liability for service tax on job work of assembling items using inputs supplied by principal.
2. Rejection of plea that activity falls under "manufacture" and not liable for service tax.
3. Rejection of appeal by Commissioner (Appeals) due to non-deposit of pre-condition amount.
4. Stay application for adjudged dues and consideration of appeal without pre-deposit of penalties.

Analysis:
1. The appellants undertook job work of assembling items using inputs supplied by their principal, not paying the service tax due initially. The authorities pointed out the liability, leading to the appellants paying the service tax and interest before the show-cause notice. The original authority confirmed the tax demand, interest, and imposed penalties under sections 76 & 78 of the Finance Act, 1994. The appellants argued that the activity fell under "manufacture" and should not attract service tax, but this plea was rejected at various levels.

2. The appellants' plea that the activity amounted to "manufacture" and should be governed by the Central Excise Act, not service tax, was consistently rejected. The lower appellate authority and the Commissioner (Appeals) both dismissed the appeal, with the latter requiring a pre-deposit of the tax amount before considering the appeal. The appellants contended that their claim of having a prima facie case was not adequately considered, and their request to modify the order for a hearing without pre-deposit was also denied without a hearing.

3. The appellants moved a stay application for the adjudged dues, seeking justice. The Tribunal, after hearing both parties, dismissed the stay application and proceeded to consider the appeal itself. It was noted that the service tax and interest had been paid before the show-cause notice, and in such cases, depositing penalty amounts is not typically required to hear an appeal. Therefore, the Tribunal set aside the impugned order and remanded the matter to the Commissioner (Appeals) for disposal on merits without insisting on pre-deposit of penalties.

4. The Tribunal, after dismissing the stay application, decided to consider the appeal without requiring pre-deposit of penalties. The decision was based on the fact that the service tax and interest had already been paid, making it unnecessary to insist on pre-deposit of penalties. The matter was remanded to the Commissioner (Appeals) for further consideration on merits without any pre-deposit requirements.

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