2014 (1) TMI 1510 - AT - Service Tax

Denial of Cenvat credit on Input service tax Held that -The appellant is not making any grievance about depositing the amount, there was no reason to grant waiver of pre-deposit of the CENVAT credit denied - The issue involved is one of interpretation - the appellant directed to make a pre-deposit of the entire amount of CENVAT credit denied stay not granted.

Summary

Issues:
1. Admissibility of CENVAT credit for input services related to erection, commissioning, and aviation consultancy.
2. Requirement of pre-deposit of disputed input service tax credit and penalty.
3. Granting waiver of pre-deposit and stay of recovery based on compliance.

Analysis:
1. The appellant claimed CENVAT credit for input services like erection, commissioning, and aviation consultancy. The Additional Commissioner argued that such credits are not admissible as they are not related to manufacturing activities. The Tribunal considered both sides' submissions and decided that the appellant should pre-deposit the balance amount of Rs. 59,963/- within six weeks. The issue involved interpretation, and the Tribunal upheld the denial of CENVAT credit for the mentioned services.

2. The appellant had reversed a portion of the disallowed CENVAT credit but had not deposited the balance amount. The Additional Commissioner requested the appellant to deposit the entire dues. The Tribunal, noting that the appellant did not contest the deposit requirement, directed the appellant to comply with the pre-deposit of the balance amount within the specified timeline. The Tribunal waived the pre-deposit requirement for the penalty upon compliance and granted a stay of recovery.

3. The Tribunal emphasized the importance of compliance with the pre-deposit directive, requiring the appellant to report compliance within a set timeframe. The waiver of pre-deposit for the penalty was contingent upon meeting the pre-deposit requirement for the disputed CENVAT credit. The stay of recovery was granted subject to the appellant's adherence to the specified directives, ensuring the appellant's financial obligations were met while providing relief from immediate penalty enforcement.