Pre-deposit in service tax appeal allowed only partly, with balance tax to be paid and interest and penalty stayed

Waiver of pre-deposit was granted only in part in a service tax appeal. On a prima facie view that the adjudicating authority had noted deliberate alteration of evidence and that substantial sums had already been deposited during investigation, the appellant was required to deposit the balance admitted service tax before the appeal could be heard. Recovery of interest and penalty was stayed during the pendency of the appeal.

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Issues: Whether the appellant was entitled to waiver of pre-deposit of the balance service tax, interest and penalty pending disposal of the appeal.

Analysis: A prima facie view was taken that the adjudicating authority had found a deliberate change of evidence and that substantial amounts had already been deposited during investigation. In that background, the balance admitted service tax liability was directed to be deposited as a condition for hearing the appeal, while deposit of interest and penalty was waived during pendency.

Outcome: The appellant was directed to make pre-deposit of the balance service tax within four weeks, and recovery of interest and penalty was stayed during the appeal.

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