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of <h1>Parent Company's Tax Pre-Deposit Validated, Technical Rejection Overturned, Appeal Restored for Comprehensive Merits Review</h1> HC allowed appeal against customs tribunal's order, finding technical rejection of pre-deposit unjust. Despite separate tax registrations, court permitted ... Dismissal of appeal filed by the appellant for non-compliance of the conditions imposed for grant of stay - HELD THAT:- Taking note of the pendency of the merger proceedings, the parent company namely, M/s. St. John Freight System Limited, deposited the money as directed by the conditional order. The Tribunal has refused to accept such deposit as a proper compliance with conditional order passed, because both the companies had separate service tax registration. It now turns out that the parent company, which has deposited a sum of Rs. 20,00,000/- pursuant to the interim order is under liquidation. The appellant cannot be penalized for the error. The appellant has to be given an opportunity to have its appeal heard on merits. No doubt, the Tribunal was justified in concluding that the deposit by the parent company, which had a separate service tax registration, cannot be taken as a proper compliance, at the same time, the order of the Tribunal imposing a condition has been complied with an ends, we find that such a rigid view would only result in the appeal being thrown out on a technical ground, thereby, resulting a denial of opportunity to the appellant. It is directed that the payment made by the parent company to be taken as a payment made by the appellant company for the purposes of the compliance with the interim order alone. We therefore, set aside the order of the Tribunal. The appeal is restored to file. The Tribunal is requested to dispose the appeal on merits. Appeal allowed. The Madras High Court, in an appeal against the Customs, Central Excise and Service Tax Appellate Tribunal's order dismissing the appellant's appeal for non-compliance with stay conditions, addressed the issue of pre-deposit payment. The appellant was directed to make a pre-deposit of Rs. 20,00,000, which was deposited by its parent company, M/s. St. John Freight System Limited, due to pending merger proceedings. The Tribunal rejected this deposit, noting separate service tax registrations, and dismissed the appeal.The High Court acknowledged the Tribunal's correctness in noting separate registrations but held that 'such a rigid view would only result in the appeal being thrown out on a technical ground,' denying the appellant an opportunity to be heard on merits. Since the parent company is under liquidation, penalizing the appellant for the deposit error was unjust.Accordingly, the Court directed that the payment by the parent company be 'taken as a payment made by the appellant company for the purposes of the compliance with the interim order alone,' set aside the Tribunal's dismissal order, restored the appeal to file, and remanded it for disposal on merits. The Civil Miscellaneous Appeal was allowed with no costs.
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