SC asks Jetlite to pay Rs 70 cr

The Supreme Court today asked Jet Airways' low cost arm Jetlite India, to deposit Rs 70 crore within eight weeks in a case pertaining to alleged service tax evasion.

A Bench comprising Justice Mukundakam Sharma and A R Dave directed Jetlite to make a pre-deposit of Rs 70 crore as service tax within eight weeks.

The apex court's direction came over a petition filed by Jetlite, challenging the direction of the Delhi High Court to pay Rs 70 crore, which was to be deposited by this week.

The matter is related to alleged service tax evasion by the low cost carrier. The service tax department has asked Jetlite to pay Rs 260 crore, including interests, for evading tax.

This was challenged by Jetlite before the Customs Excise and Service Tax Appellate Tribunal, which as per the rules directed it to make a pre-deposit of half of the tax liability.

The tribunal had ordered the company to make a pre deposit on June 25.

The service tax department had actually sought Rs 260 crore from Jetlite India in 2008 on account of the advertising activities of Sahara Airlines. Jetlite took over Sahara Airlines in 2007.

The department's case was that Sahara Airlines had carried advertisements of a group company, Sahara India Commercial Corporation on its tickets during 2003-2007, thus giving a business auxiliary service to the latter. Thus, Sahara Airlines, and later Jetlite, became liable to pay service tax.