2013 (1) TMI 661 - AT - Service Tax

Waiver of penalty - Stay of recovery - Denial of Cenvat credit - Rule 2 (1) of the Cenvat Credit Rules 2004 - Rent-a-cab service - Out-door catering service - Event Management service - Clearing and Forwarding service Held that - Rent-a-cab service has been availed for picking up and dropping their employees and outdoor catering service provided to the employee of applicants are allowed to take cenvat credit on the basis of decision in case of Stanzen Toyotetsu India (P.) Ltd.(2011 (4) TMI 201 - KARNATAKA HIGH COURT). Therefore, they are entitled to take input CENVAT credit. In favour of assessee Event management service and clearing & forwarding service - These services does not fall within the category of input credit service as defined in Rule 2 (1) of the Cenvat Credit Rules 2004. Therefore, prima facie, the applicants are not entitled for the benefit of input service credit. As the Applicant has already reversed the said amount, we waive the requirement of pre-deposit of the balance amount of service tax, interest and penalty. In favour of assessee

Summary

Issues: Service tax demand on denial of Cenvat credit for specific services.

Analysis:
The judgment by the Appellate Tribunal CESTAT Chennai addressed the service tax demand confirmed against the applicants amounting to Rs.2,22,11,915 for the denial of Cenvat credit on rent-a-cab service, outdoor catering service, event management service, and clearing and forwarding service. The Tribunal considered the nature of each service to determine the eligibility for Cenvat credit.

Regarding the rent-a-cab service and outdoor catering service, the Tribunal found that the applicants used these services for their employees, and based on a previous decision, they were allowed to avail Cenvat credit. Citing a specific case law, the Tribunal ruled that the applicants were entitled to take input Cenvat credit for these services.

However, for event management service and clearing and forwarding service, the Tribunal examined the activities undertaken by the applicants and concluded that these services did not fall within the category of input credit service as defined in the Cenvat Credit Rules 2004. Therefore, the applicants were not considered eligible for the benefit of input service credit for these specific services.

Moreover, the Tribunal noted that the applicants had already reversed the amount related to the services for which they were not entitled to Cenvat credit. As a result, the Tribunal waived the requirement of a pre-deposit for the balance amount of service tax, interest, and penalty. Additionally, the recovery of the waived amount was stayed during the pendency of the appeal, providing temporary relief to the applicants.

In a procedural aspect, the Tribunal addressed a Miscellaneous Application filed by the Revenue for a change in the cause title. The Respondent's name was initially mentioned incorrectly as Commissioner of Central Excise, Chennai III, instead of Commissioner of Service Tax, Chennai. The Tribunal allowed the request to change the cause title, substituting the correct authority for proper identification in the legal proceedings.

Overall, the judgment provided a detailed analysis of the eligibility of Cenvat credit for specific services and highlighted the procedural aspect of correcting the cause title for accurate representation in the legal proceedings.