2013 (12) TMI 1031 - AT - Central Excise

Denial of service tax on Renting of immovable property and on personal accident policies - Waiver of Pre-deposit Held that - Denial of CENVAT Credit on Service Tax paid by the appellant would be incorrect as the processing activities carried out by the appellant are relatable to the manufacturing of final product - as regards Personal Accident Insurance Policies, even if an employee is working in Kanpur and insurance policy is taken in Daman, Service Tax paid on such insurance policy is in relation to the business activities of the appellant - the appellant has made out a prima facie case for waiver of the amounts involved pre-deposits waived till the disposal stay granted.

Summary

Issues:
Denial of CENVAT Credit on Service Tax paid on Maintenance & Repair services, Renting of Immovable Property, and Personal Accident Insurance Policies.

Analysis:
The judgment pertains to a Stay Petition seeking a waiver of pre-deposit of CENVAT Credit, interest, and penalty imposed on the appellant. The lower authorities confirmed the denial of CENVAT Credit on amounts related to Service Tax paid on Maintenance & Repair services, Renting of Immovable Property, and Personal Accident Insurance Policies. The Tribunal focused on the denial of credit concerning renting of immovable property and personal accident insurance policies. It was observed that the appellant rented premises for processing activities linked to manufacturing the final product, justifying the CENVAT Credit claim. Additionally, regarding the insurance policies, it was noted that even if employees worked in a different location, the insurance policy's Service Tax payment was related to the appellant's business activities. The Tribunal found a prima facie case for waiving the amounts involved, allowing the application and staying the recovery until the appeal's disposal.

This judgment highlights the Tribunal's detailed analysis of the denial of CENVAT Credit on specific services, emphasizing the nexus between the services availed and the appellant's business activities. The reasoning provided by the Tribunal regarding the renting of immovable property and the insurance policies demonstrates a thorough evaluation of the factual and legal aspects to determine the eligibility for CENVAT Credit. The decision to grant a waiver of pre-deposit and stay the recovery showcases the Tribunal's consideration of the appellant's arguments and the prima facie validity of their case. Overall, the judgment reflects a nuanced approach to interpreting and applying the relevant legal provisions governing CENVAT Credit in the context of the appellant's circumstances.