- (1.) THE present appeal which has been filed by Bharat Sanchar Nigam Ltd., Ballia under section 35G of the Central Excise Act, 1944 arises from an order dated January 21, 2014 of the Customs, Excise and Service Tax Appellate Tribunal, New Delhi. The Tribunal dismissed the appeal as the appellant failed to comply with the interim directions issued by the Tribunal earlier on September 17, 2013 requiring the appellant to deposit Rs. 1,14,77,883 together with corresponding interest under section 75 of the Finance Act, 1994. Though, a number of substantial questions of law have been framed, the following question would covers the controversy: "Whether the Tribunal was justified in demanding the entire adjudicated amount along with interest and penalty in compliance of section 35F of the Central Excise Act, 1944 -
(2.) THE appellant is registered under section 69 of the Finance Act, 1994 with the Excise Department for providing telephone service. A demand -cum -show -cause notice dated October 10, 2007 was issued by the Commissioner, Central Excise, Allahabad. It was stated that the assessee had made a short -collection/payment of service tax in the amount of Rs. 1,14,77,883 during the period January, 2002 to December, 2006. This amount was, therefore, liable to be recovered from the assessee along with interest as per the provisions of section 73 read with section 75 of the Act and the appellant was also liable to pay penalty under section 78 of the Act. The appellant filed a reply dated December 7, 2007 denying wilful suppression of facts but accepted that ST -3 returns had not been submitted. The adjudicating officer passed the following order on February 14, 2008: "1. I confirm the demand of service tax amounting to Rs. 1,14,77,883 (rupee one crore fourteen lakhs seventy seven thousand eight hundred eighty three only) to be recovered under section 73 of the Act in accordance with the provisions of section 68 of the Act along with interest due as provided in section 75 of the Act from M/s. Bharat Sanchar Nigam Ltd., Ballia. 2. I order to appropriate the amount of Rs. 5,57,820 (rupees five lakhs fifty seven thousand eight hundred twenty only) paid under protest by the party in this regard. I impose a penalty of Rs. 200 for every day delay up to April 18, 2006 thereafter two per cent per month of the service tax amount till the payment of outstanding amount is made subject to the maximum of service tax amount under section 76 of the Act for violation of section 68 read with rule 6 of Rules on the party.
(3.) I impose a penalty of Rs. 1,14,77,883 (rupee one crore fourteen lakhs seventy seven thousand eight hundred eighty three only) on the said party under section 78 of the Act." 3. The appellant preferred an appeal under section 86 with a stay -cum -waiver application before the Tribunal. 4. The Tribunal by a detailed order dated September 17, 2013 disposed of the application for stay/waiver of pre -deposit of the amount assessed in the adjudication order dated February 14, 2008 with the following observations: "3. Though the learned counsel for the petitioner argued that liability was assessed not on the basis of actual value received for the taxable services provided but on taking into account amounts which are receivable, on a careful scrutiny of the adjudication order we find that no clear basis for this contention. In the summary of 'discussions and findings', the adjudicating authority had noted that the taxable service during the period January, 2002 to December, 2006 was correctly computed by deducting the amount of service tax payment for the particular month from the amount shown as taxable value including service tax and on that basis the recoverable amount of service tax was calculated as per the applicable rate. The adjudicating authority also concluded that the petitioner made short -collection of service tax against the amount actually recovered resulting in short -services of service tax. Later, in the order, the adjudicating authority also noted that the petitioner made short -collection from January, 2002 to December, 2006 to the extent confirmed. From the adjudication order, we not able to infer with any degree of certitude that amounts not received were also included in the received value of services provided. In the summary of the adjudication order, the authority records that if no revenue was collected, the assessee did not disclose the same in its chart and hence there is no question of outstanding amounts of service tax not received from defaulter subscribers. The adjudicating authority also records that the demand is arrived at on the basis of assessee's reported figures of revenue collected including service tax deposited. 4. In the aforesaid circumstances, we are not inclined to grant waiver of pre -deposit in full. Since even if there be some error in the adjudication order with regard to determination of the quantum of the liability, considerable responsibility for such possible error is attributable to the assessee. However, duly considering the fact that the assessee is an instrumentality of the State, we grant waiver of pre -deposit and stay all further proceedings for recovery of the adjudicated liability as set out in the impugned order, on condition that the petitioner remits Rs. 1,14,77,883 plus the corresponding interest on this amount under section 75 of the Act, within eight weeks from today and reports compliance by November 18, 2013. In default of either deposit or in reporting compliance within the time stipulated herein, the order of waiver shall stand rescinded and the appeal shall stand dismissed for failure of pre -deposit. Learned counsel for the appellant is present in the court, has noted this order and undertakes to communicate the obligations under this order to the assessee. This application is disposed of as above.";