S. Nagamuthu, J. - (1.) THE petitioner is a trust, registered under the Indian Trust Act, 1882, and is engaged in promoting education and conducting classes to the students under the Distance Education Programme of various Universities such as Tamil Nadu Open University, Mother Theresa University and Allagappa University. For imparting education to the students, the petitioner's trust collects prescribed fee from the students and a part of the said amount is paid to the university and the balance amount is retained by the petitioner's trust.
(2.) WHILE so, the Assistant Commissioner of Central Excise, Trichy -I issued a show cause notice to the petitioner by his proceedings in C. No. V/ST/30/ 10/2006 -ST -Adj dated June 7, 2006 calling upon the petitioner's trust to pay a total sum of Rs. 71,200 towards service tax of Rs. 70,953 and education cess of Rs. 247 for the period from July 2003 to March 2005. The petitioner submitted his explanation for the same stating that the service which is rendered by the petitioner's trust does not fall within the scope of Section of Chapter V of the Finance Act, 1994 and so the petitioner is not liable to pay any service tax. But, the Assistant Commissioner has passed final order dated November 24, 2006 thereby directing the petitioner to pay Rs. 71,200 as service tax with interest till the date of actual payment and also imposed penalty to the tune of Rs. 71,200 and Rs. 1,000 under Section and Rs. 71,200 under Section and Rs. 500 under Section of the Finance Act, 1994. The petitioner challenged the same by way of appeal before the Commissioner of Central Excise (Appeals), Trichy. The second respondent took up the appeal and passed final order on April 2, 2007 in Appeal No. 15 of 2007 and confirmed the order of the Assistant Commissioner. Challenging the same the petitioner has preferred an appeal to the first respondent -Tribunal. The said appeal is pending in Appeal No. 140 of 2007. Along with the said appeal, the petitioner has made an interlocutory application praying for an order of stay. The Tribunal however has passed a conditional order of stay directing the petitioner to pre -deposit the entire amount of service tax of Rs. 71,200 and waived the penalty for the purpose of stay. The said stay order of the first respondent is under challenge in this writ petition.
(3.) HEARD the learned Counsel for the petitioner and the learned Assistant Solicitor General of India appearing for the respondents. The learned Counsel for the petitioner would submit that the Tribunal was not right in imposing condition that the petitioner should pre -deposit Rs. 71,200 which is the service tax covered under the impugned order. He would submit that while considering the petition for stay during the pendency of the appeal, the first respondent is required to consider two main aspects, namely, (i) prima facie case and (ii) financial position of the petitioner. The learned Counsel would rely on a judgment of the honourable Supreme Court in Benara Valves Ltd. v. : 2006ECR314(SC) , and a judgement of this court in Ramaswamy Naidu Textiles Ltd. v. CEGAT, Chennai reported in, [2003] 111 ECR 397 and another judgment of this court in W.P. No. 4535 of 2004 Sri Naga Nanthana Mills Limited v. Commissioner of Central Excise (Appeals) in support of the above contentions.;