Chhattisgarh High Court Grants 3 Months Time To The Assessee For Depositing Pre-Deposit Before CESTAT

The Chhattisgarh High Court grants 3 months time to the assessee for depositing pre-deposit before the Customs, Excise, and Service Tax Appellate Tribunal (CESTAT).

The bench of Justice Parth Prateem Sahu rejected the prayer in respect of the waiver of the mandatory pre-deposit.

The petitioner, Nava Raipur Atal Nangar Vikas Pradhikaran, is a statutory body created through a notification dated January 8, 2002, issued by the state government under Chhattisgarh Nagar Tatha Gram Nivesh Adhiniyam, 1973. It was created as a Special Development Authority with the objective of preparing the development plan for the special areas after approval by the state government and, for the purpose of implementation of the plan, acquiring, holding, developing, managing, and disposing of lands and other property.

The petitioner is registered with the Service Tax Department under the former tax regime. Based on the report of a short payment of service tax, an inquiry was initiated against the petitioner, and a show-cause notice was also issued. The petitioner submitted a reply refuting the allegation. Upon adjudication, the Principal Commissioner, Central Tax and Central Excise, Raipur, passed an order demanding service tax with interest under Section 75 of the Finance Act, 1994, and a penalty under Section 78.

The petitioner preferred an appeal before the Customs, Excise, and Service Tax Appellate Tribunal, New Delhi. As the petitioner has not deposited the requisite pre-deposit, an information letter was issued to the petitioner informing him that the mandatory deposit has not been made.

The petitioner submitted that it was suffering from financial hardship post-COVID-19 pandemic. Due to lockdown during the effects of the COVID-19 pandemic in the state of Chhattisgarh, the commercial operations and activities of the petitioner were adversely affected, resulting in an acute cash crunch. Due to lockdown during the COVID-19 pandemic, there was a recession in the market, and considering the period, the petitioner waived off the delayed interest recoverable on delayed payment of lease rent or lease premium, which reduced revenue collection for the petitioner.

The department contended that a writ petition is not maintainable, making prayer only for a waiver of mandatory pre-deposit under Section 35-F of the Act of 1944.

The court allowed the alternate prayer and extended the time for the mandatory deposit. A further three months' time is granted to the petitioner to deposit the amount of the mandatory pre-deposit before the Tribunal from the date of passing of the order.

Case Title: M/s Nava Raipur Atal Nangar Vikas Pradhikaran Versus The Union Of India

Citation: 2023 LiveLaw (Chh) 14

Case No.: WPT No. 116 of 2021

Date: 09.05.2023

Counsel For Petitioner: Yogendra Aldak, Katyayani Vishnupriya

Counsel For Respondent: Maneesh Sharma

Click Here To Read The Order