ORDER
S.L. Peeran, Member (J)
1. The appellant is required to pre-deposit service tax amount of Rs. 54,27,678/- and penalty of Rs. 55,00,000/- under Section 78 besides penalty of Rs. 100/- per day under Section 76 and penalty of Rs. 1,000/- under Section 77 of the Act. The appellant is a Corporation carrying on the activity of “Safari Tours” as part of tourism since 1971 set up by the State Government of Karnataka. They have been brought under the category of “Tour Operators”. The appellant’s contention is that they were not carrying on the activity of tour operators in as much as the tour was arranged through Railways and by the Department of Forest of the Government of Karnataka and hence they do not come under the said category as per its definition. It is their submission that the value of the total service carried out excludes these two operations which were required to have been adjudicated but the same has not been done. The Commissioner has also accepted this position. Further he has confirmed that the assessee are entitled for deduction on producing proof of evidence. It is the submission of the learned Counsel that with regard to the aspect of deduction, the Commissioner ought to have sent the matter for re-quantification which has not been done. He submits that the entire aspects pertaining to the activities were known to the Department. Hence the demands are barred by time. He also submits that the appellants are faced with huge losses and the latest Balance Sheet shows the accumulated loss of Rs. One Crore. He submits that in order to enable the assessee to contest the case, he would advise the appellants to pre-deposit a sum of Rs. 12,00,000/-, if three months time is granted.
2. The learned DR submits that the issue is covered in the Revenue’s favour in terms of the ruling of the Apex Court rendered in the case of Tamil Nadu Tour Vehicle Owners & Operators Assn. v. U.O.I. 2003(157) E.L.T. A144 (S.C.). The learned DR submits that the assessee did not produce the evidence for claiming the deduction. Therefore the amounts were confirmed.
3. In counter, the learned Counsel submits that all the documents had been furnished before the Original Authority for reworking of quantum of tax, yet it was not done.
4. On a careful consideration of the matter, we notice from the impugned order that the Commissioner has accepted the plea for deduction claimed by the assessee with regard to the tours arranged by the Railways and the Forest Department. We also notice that the matter is required to be sent back for de novo adjudication to arrive at the correct tax liability. The appellant’s plea of time bar is required to be considered. In these circumstances, the plea of financial hardship and offer made is accepted.
5. Hence we direct the appellants to pre-deposit a sum of Rs. 12,00,000/- (Rupees Twelve lakhs only) within a period of three months from today and on such deposit, the balance amount of service tax and penalty stands waived and recovery stayed till the disposal of the appeal. Failure to comply this order will entail dismissal of the appeal. Call on to report compliance on 12th February 2008. On compliance, the either side can move an application for an early hearing of the matter.
(Pronounced and dictated in the open court)