2013 (8) TMI 564 - AT - Service Tax

CENVAT credit on telecommunication service - main issue involved is whether the tower on which the antenna is mounted by the applicants would constitute capital goods for the purpose of Rule 3 of the CENVAT Credit Rules, 2004 department contended that the applicants availed irregular CENVAT Held that - Revenue is not able to produce any order with respect to duty demand - by order dated 14th March 2012 and 28th March 2012 directed that the duty demand confirmed by the CESTAT shall not be enforced till further orders. Waiver on Pre deposit - Stay application appellant contended that they have already reversed the credit availed by twice Held that - Court granted waiver of pre deposit and stay of recovery of dues application decided in the favour of the assessee.

Summary

Issues Involved:
1. Whether the tower on which the antenna is mounted would constitute capital goods for the purpose of Rule 3 of the CENVAT Credit Rules, 2004.

Detailed Analysis:
The judgment involved multiple applications with a common issue regarding the denial of CENVAT credit and imposition of penalty on the applicants for availing irregular credit on various services and equipment. The main contention was whether the towers on which the antennas were mounted could be considered as capital goods under Rule 3 of the CENVAT Credit Rules, 2004.

The applicants, represented by their advocate, presented a chart detailing the demands of tax for each appellant, including Vodafone Essar Cellular Ltd., Bharti Airtel Ltd., and Airtel Ltd. These demands encompassed issues such as input/capital goods credit on towers & shelters, input services related to towers & shelters, and other input services like construction, rent-a-cab, catering, insurance, and security for unregistered premises, among others. The total demands for each appellant were specified in the chart.

The advocate for the applicants argued that they had already reversed the credit availed twice and cited previous cases where the Tribunal had granted unconditional stays on similar issues. The advocate requested an unconditional stay and the suspension of recovery of dues in the present case as well.

On the other hand, the Authorized Representative contended that a previous Tribunal decision ruled against the applicants, requiring them to deposit the entire amount of dues. Reference was made to a case involving M/s. Bharti Airtel Ltd. where the Tribunal directed a pre-deposit of Rs.5 crores, which was later stayed by the Bombay High Court. The AR emphasized that the temporary interim order from the High Court did not hold any force for granting a stay in the current appeal.

After considering the arguments from both sides and examining the records, the Tribunal referred to the Bombay High Court's direction to decide the appeal without any pre-deposit. It was noted that the Tribunal had previously declined to follow stay orders due to subsequent judgments, but the questions raised in those decisions were deemed different from the present case. The Bombay High Court had directed that the duty demand confirmed by the CESTAT should not be enforced until further orders. Consequently, the Tribunal granted a waiver of pre-deposit and stayed the recovery of dues pending the disposal of the appeals.