2011 (3) TMI 1051 - AT - Service Tax

Waiver of pre-deposit - unconditional stay - Held that - Since the issue involved in the current appeal and in appeal No.ST/431/08 being the same direct the Registry to link the appeals together and list them for disposal - Decided in favour of the assessee

Summary

Issues Involved:
1. Eligibility of service tax credit on commission received for sale.
2. Utilization of service tax credit for supplying XBIS systems.

Analysis:
1. The primary issue in this case pertains to the eligibility of the appellant to avail service tax credit on the commission received for the sale. The appellant sought a waiver of pre-deposit for amounts related to Cenvat credit, interest, and penalty. The Tribunal considered the appellant's contention regarding the service tax credit availed on the commission received and its utilization for supplying XBIS systems to various establishments. The Tribunal referred to a previous Stay Order where unconditional stay was granted in a similar situation for an earlier period. The Tribunal examined the nature of the service provided by the appellant and the applicability of Cenvat Credit Rules in relation to the service rendered to Jammu & Kashmir region. It was observed that the appellant's service to Jammu & Kashmir did not fall under the exempt category, thereby not necessitating the maintenance of a separate account as per Rule 6(3)(c) of Cenvat Credit Rules. Additionally, the denial of input service tax credit on the sales commission paid by the appellant was also addressed. The Tribunal found merit in the appellant's case and ordered the waiver of the pre-deposit amount until the appeal's disposal.

2. Another aspect of the case involved the utilization of service tax credit for supplying XBIS systems. The Tribunal noted that the issue in the current appeal was identical to a previous appeal by the same assessee. Consequently, the Tribunal allowed the application for the waiver of pre-deposit amounts and stayed the recovery until the appeal's final disposal. The Tribunal directed the Registry to link the current appeal with the previous one for joint disposal. This comprehensive analysis by the Tribunal considered the appellant's eligibility for service tax credit, the nature of services provided, and the applicability of relevant rules and precedents in granting the waiver of pre-deposit amounts and stay on recovery pending appeal.