Protective demand in case of filing appeals in refund matters

[Aruldas Chettiar]

Whether Protective demand is to be issued in case of filing appeals in refund matters

AI Summary

Protective Demands in Service Tax Refund Appeals Allowed Unless Stayed by Higher Courts; Pre-Deposit Rules Changed in 2014. A query was raised regarding the issuance of protective demands when filing appeals in refund matters related to service tax. The response clarified that unless a high court or the Supreme Court stays the operation of an order-in-original under Articles 226 or 32 of the Constitution, the department can issue protective show cause notices for subsequent periods. If an injunction is granted, the department is barred from issuing such demands. Prior to August 6, 2014, the Commissioner (Appeals) and CESTAT could stay pre-deposit payments; post this date, a mandatory pre-deposit is required for appeals. Only higher courts can stay show cause notices.