2013 (5) TMI 212 - AT - Central Excise

Waiver of the pre-deposits - Revenue submits that cenvat credit is ineligible as same is not related to activity of manufacturing. - held that - As the appellant having deposited the entire amount of Cenvat credit which has been disallowed by the lower authorities, the first appellate authority should have disposed the appeal on merits, the impugned order is set aside and remit the matter back to the first appellate authority.

Summary

Issues involved:
Eligibility of Cenvat credit for service tax paid on consultation fee before Anti-dumping body; non-compliance with pre-deposit order by first appellate authority.

Analysis:

Issue 1: Eligibility of Cenvat credit for service tax paid on consultation fee before Anti-dumping body

The appellant filed a stay petition seeking waiver of the pre-deposit of the credit amount held as ineligible by lower authorities, arguing that the credit was not related to manufacturing activities. The Tribunal noted that the first appellate authority did not provide any findings on the case's merits but dismissed the appeal due to non-compliance with the pre-deposit order. The Tribunal decided to allow the stay petition and take up the appeal for disposal. It was observed that the issue revolved around the eligibility of Cenvat credit for service tax paid on consultation fees for representing the appellant before the Anti-dumping body. The Tribunal emphasized that protecting one's business interests constitutes a business activity, warranting a thorough examination by the first appellate authority. However, since the first appellate authority failed to address the case's merits, the Tribunal refrained from expressing any opinion on the matter, remitting it back for reconsideration on its merits without necessitating further pre-deposit. The Tribunal kept all issues open, emphasizing the need for a fresh assessment by the first appellate authority following principles of natural justice.

Issue 2: Non-compliance with pre-deposit order by first appellate authority

The Tribunal's judgment highlighted the failure of the first appellate authority to provide any substantive findings on the merits of the case but instead dismissed the appeal due to non-compliance with the pre-deposit order. The Tribunal set aside the impugned order and remitted the matter back to the first appellate authority for a reconsideration of the case afresh, emphasizing the importance of addressing the merits of the case without insisting on further pre-deposit. The Tribunal clarified that it refrained from expressing any view on the case's merits and kept all issues open for the first appellate authority's review.

In conclusion, the Tribunal allowed the appeal by way of remand, directing a fresh consideration of the case by the first appellate authority on its merits without the requirement of additional pre-deposit, ensuring adherence to principles of natural justice in the process.