2010 (4) TMI 1119 - AT - Service Tax

Summary

Issues involved: Denial of credit of service tax paid on CHA service and air travel service.

Denial of credit of service tax on CHA service: The issue involved in this case is the denial of credit of the service tax paid on the CHA service. The Tribunal found that the CHA services are utilized by the appellant for import or export of goods. It was noted that the service tax paid on these services is eligible for cenvat credit, as supported by various decisions of the Tribunal such as Adani Pharma Chem P. Ltd. Vs. CCE, Rajkot [2009(238) ELT 179(Tri. Ahmd.)]. Therefore, the Tribunal held that the applicant has made out a prima facie case for waiver of pre-deposit of the amounts adjudged by the lower authorities.

Denial of credit of service tax on air travel service: Regarding the service tax paid on air travel service, the Tribunal considered it as expenses in the course of business. It was observed that the recent decisions support this view. Consequently, the Tribunal found that the applicant has established a prima facie case for waiver of pre-deposit of the amounts demanded by the lower authorities. The application for waiver of pre-deposit of amounts was allowed, and recovery was stayed until the disposal of the appeal.