TaxTMI 
TaxTMI 
2024 (12) TMI 942
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....ts without insisting on pre-deposit and to condone the delay, if any, on the ground of limitation. (c) award costs of the present petition to the petitioner and against the respondents. (d) pass such other order or orders as this Hon'ble Court may deem fit and proper in the facts and circumstances of the case." 2. Although the principal challenge is to the Order-in-Original dated 10 March 2023, the petitioner has been constrained to approach this Court in light of the provisions made in Section 35F of the Central Excise Act, 1944 [Act] and in terms of which a condition of pre-deposit has come to be created in terms of this statute. 3. Undisputedly, the statute no longer confers any discretion on the first appellate authority or the CESTAT to waive the condition of pre-deposit. It is in the aforesaid backdrop that the writ petitioner has approached this Court to submit that the facts of the present case would reveal that this is one of those rare and deserving cases where the Court would be justified in invoking its jurisdiction conferred by Article 226 of the Constitution. 4. From a reading of the Order-in-Original, we find that one of the liabilities which stood raised agai....
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....endered by the CRS companies was made by the airline, being the beneficiary, directly to the concerned CRS. Evidently, the airline specific CRS software and the data processing centre maintained by the CRS companies, accessed and used by the airline and the travel agents, were for the sole benefit of airline, facilitating sale of their products and services. It was for this service that the airline paid to the CRS companies which resulted in the booking of air tickets of the airline. xxx xxx xxx 29. The Assessee is an approved agent of International Air Ticketing Association (IATA). It was observed that they had agreements with M/s. Interglobe Technology Quotient Pvt. Ltd. The said companies were providing Central Reservation System (CRS) {a Global Distribution System} to the Assessee to book air ticket of various Airlines with which they had business tie up. By using this CRS, the travel agents are able to access the centralized data base and book a segment (air ticket/hotel room/car rental). The assessee uses this CRS for booking of air tickets of various airlines. The CRS enables the Air travel agents/tour operators such as the assessee to do their business efficiently. With....
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....rvice tax under the category of BAS." 8. Ultimately and on a consideration of the statutory scheme which existed, the CESTAT came to hold as follows: - "60. It is seen that the CRS commission is paid to a travel agent if he is able to attain an agreed level of segments to be booked. A passenger is not aware of the CRS Company being utilized by the travel agent for booking the segment nor can a passenger influence a travel agent to avail the services of a particular CRS Company. What is important to notice is that for an activity to qualify as "promotional", the person before whom the promotional activity is undertaken should be able to use the services. The passenger cannot directly use the CRS software provided by the Company to book an airline ticket. It cannot, therefore, be said that a travel agent is promoting any activity before the passenger." 9. The Larger Bench then proceeded to frame its conclusions as under: "82. A perusal of the aforesaid decision would indicate that though in paragraph 2 of the decision, the Division Bench noted that the lower authorities had categorized the services rendered by the appellant as "tour operator", but in paragraph 5 of the decision....
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....e amounts claimed as productivity/performance linked benefit (PLB)/ incentive earned: 62.1 It has been alleged in the show cause notice that income was being collected by the noticee in addition to the commission being received from the Airlines or other IATA agents. These incomes are generated while discharging of their Air Travel Agent's services. A demand of service tax amounting to Rs.47,20,541/- has been raised in Table-11 above. In TABLE-E of their letter dated 05.03.2019 submitted to the department, the noticee had claimed the amounts shown in the column "PLB/Incentive", as productivity/performance linked benefit (PLB)/ incentive earned without placing any evidence in the form of contract/agreements with the Airlines or IATA Agent to substantiate their claim. 62.2 In their replies to the SCN, the noticee has contested the above demand on account of productivity/performance linked benefit (PLB)/ incentive and has drawn support from the case law cited therein. The noticee has submitted that from the bare perusal of the dictionary meaning of the term "incentive" and the phrase "productivity linked bonus", it could be inferred that incentive/PLB is something a person or ....
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....of Rs. 47,20,541 has been worked out in Table-11 are commission received from the airlines and the IATA agents for the service provided to the passengers which were not covered under the list of negative services under section 66D ibid. In terms of charging section 66B read with sections 65B (44), 66D, and 67 ibid., such commissions are leviable to service tax inasmuch as the commission received by the air travel agent from the airlines/IATA agent has to be included in the value of the taxable service provided by the air travel agent under rule 6 (1) (iv) of the Service tax (Determination of Value Rules, 2006. I observe that whereas with effect from 01.07.2012, the concept of negative List was introduced vide Section 66D of the Finance Act, 1994 which states that only the services mentioned in the negative list are non-taxable barring the exemption by vi11ue of any notification of and rest all services are within the net of service tax. It is further observed that the said services has not been excluded from the purview of service tax vide the said -. negative list (Section 66D of The Act ibid) nor the same are exempted by the notification. Hence, the said taxable services are th....
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.... the deposit liable to be made for the purposes of an assessee pursuing an appeal where it was found that the deposit of duty, interest or penalty levied would cause undue hardship. xxxx xxxx xxxx 4. Our attention was drawn to the recent decision rendered by a Division Bench of the Court in Mohd. Akmam Uddin Ahmed v. Commissioner Appeals Customs and Central Excise where the question of the power of a High Court to dispense with the requirement of pre-deposit and to frame appropriate directions reducing the burden on an assessee in extraordinary and exceptional circumstances was answered in the following terms:- "26. The petitioners placed reliance on judgments of Coordinate Benches of this Court in Pioneer Corpn. case [Pioneer Corpn. v. Union of India, 2016 SCC OnLine Del 6758 : (2016) 340 ELT 63], Narender Yadav case [Narender Yadav v. Commr. of Customs, 2019 SCC OnLine Del 12415] and Shubh Impex case [Shubh Impex v. Union of India, 2018 SCC OnLine Del 8793] to canvas the argument that the court has in special circumstances, waived the payment of mandatory pre-deposit amount as envisaged in Section 129-E of the Act. 27. A Coordinate Bench of this Court in Pioneer Corpn. ca....
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....itioner was a salaried employee drawing Rs. 14,500 per month (i.e., Rs. 1,74,000 per annum) and that the order-in-original did not give any reasons for the penalty imposed on the petitioner, directed that the requirement of pre-deposit under Section 129-E of the Act be waived. The relevant extract is below: "... The petitioner's grievance is that as H-card holder, imposition of over Rs. 3.8 crores penalty in the overall circumstances of the case, given that the order-in-original did not record any specific adverse finding against him, is unwarranted. The petitioner, therefore, seeks a direction that the requirement of pre-deposit as a condition for the hearing and disposal of the appeal - before the Commissioner (Appeal), should be dispensed with. The court has considered the submissions, and the fact that the order-in-original discloses no reason why penalty was imposed upon the petitioner - a salaried employee drawing Rs. 14,500 per month. In the circumstances, the petitioner's appeal to the Commissioner (Appeals) shall be heard on its merits without insisting upon the requirement of pre-deposit; it is accordingly directed to be waived...." 30. In Shubh Impex case [....
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....ed means. It is not clear whether any prosecution has been launched against the petitioner. In these circumstances, in view of the material-on-record which suggests that the petitioner has very limited means to deposit any amounts, this Court is of the opinion that the relief is warranted. The requirement of pre-depositing of any amount directed to be waived, however, the petitioner shall furnish a bond and also provide reasonable security having regard to the list of immovable properties produced before the court. Subject to this, the requirement of pre-deposit is hereby waived. The petitioner's appeal shall be revived and now Cestat shall proceed to hear the parties on its merits after issuing adequate notice to the counsel." (emphasis supplied) 32. The Allahabad High Court in Ganesh Yadav case [Ganesh Yadav v. Union of India, 2015 SCC OnLine All 9174], while upholding the requirement of pre-deposit under Section 35-F of the CE Act as mandatory and dismissing the constitutional challenge, held that the High Court under Article 226 of the Constitution of India is vested with the jurisdiction in an appropriate case to dispense with the requirement of a pre-deposit. Reliance....
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....and, thus, preserved the power as available under Article 226 of Constitution of India to either waive the pre-deposit condition or to grant the right to appeal subject to a part deposit or security. The power, albeit, has been exercised only in rare and exceptional cases. 43. It was held by the Allahabad High Court, speaking through Dr. D.Y. Chandrachud, Chief Justice (as His Lordship then was) in Ganesh Yadav case [Ganesh Yadav v. Union of India, 2015 SCC OnLine All 9174] that: "8. ... Whether the writ jurisdiction under Article 226 should be exercised, having due regard to the discipline which has been laid down under Section 35-F of the Act, is a separate matter altogether but it is important to note that the power under Section 226 (sic: Article 226) has not been, as it cannot be, abridged." (emphasis supplied)" 5. As would be evident from the conclusions recorded in Mohd. Akmam Uddin Ahmed, the Court came to conclude that notwithstanding the amendments introduced in Section 129E of the Act, the powers conferred upon a High Court by Article 226 of the Constitution stand preserved and would not detract from its authority to either waive the condition of pre-deposit or t....