2014 (11) TMI 671 - AT - Central Excise

CENVAT Credit - Membership Fee of Club or Association Services - Held that - They have clearly given the details of services where credit availed for which they are eligible. As seen from the appeal memorandum, the amount of credit involved in Club or Membership Fee and Annual fee paid is ₹ 30,190/- and all other amounts relates to programme fees/subscription paid for training and development programs, subscription paid for Recruitment Firm, subscription paid for availing legal services in respect of business requirements. I find from the SCN that appellants have filed regular monthly returns and also submitted details of cenvat availed and utilized along with ARE-1 returns. When the SCN refers the appellant availed credit on various subscription fees paid, Corporate Risk Solutions, FOREX Membership subscription etc. and the appellant contested the same before Lower Authorities, but the demand has been confirmed on irregular availment of credit under Club or Association Service. The appellate authority has not given any finding on the eligibility or otherwise of the input services relating to the above services. - Matter remanded back - Decided in favour of assessee.

Summary

Issues:
1. Reversal of cenvat credit on service tax paid on Membership Fee of Club or Association Services.
2. Confirmation of demand along with interest and penalty by the adjudicating authority.
3. Rejection of appeal by Commissioner (Appeals) and upholding of Order-in-Original (OIO).
4. Eligibility of cenvat credit on input services other than Club or Membership Fees.
5. Limitation period for the demand of cenvat credit.
6. Examination of details of input service distribution by the Input Service Distributor.
7. Remanding of the matter to Commissioner (Appeals) for fresh orders.

Analysis:

1. The appellant was issued a show cause notice demanding reversal of cenvat credit on service tax paid on Membership Fee of Club or Association Services. The adjudicating authority confirmed the demand, along with interest and penalty, for the period from 1.11.2008 to 31.3.2011 by invoking the extended period.

2. On appeal, the Commissioner (Appeals) rejected the appeal and upheld the Order-in-Original (OIO), leading to the appeal before the Tribunal.

3. The appellant's advocate argued that the demand related to various subscription charges besides the Membership Fee of Club or Association service. The Commissioner (Appeals) dismissed the appeal without giving any finding on the credit availed on other input services, despite the appellant furnishing details. The advocate contended that the demand was hit by limitation.

4. The Ld. Advocate acknowledged that Club and Membership fee is not an eligible service but argued that the demand was hit by limitation. Various case laws were cited to support the arguments.

5. The Ld. AR reiterated the impugned order, stating that the appellants were not eligible for input service credit on Membership Fee or Club or Association Fee. The department discovered the irregular availment of cenvat credit during an audit, justifying that the show cause notice was not time-barred.

6. After examining the records and submissions, the Tribunal found that the demand pertained to Membership Fee and Club or Association Service for the period from 1.11.2008 to 31.3.2011. The Tribunal noted discrepancies in the details of services and directed the Commissioner (Appeals) to re-examine the eligibility of cenvat credit on input services other than Club or Membership Fees and the issue of limitation.

7. The Tribunal set aside the impugned order and remanded the matter to the Commissioner (Appeals) for fresh orders, emphasizing a thorough examination of the appellant's contentions and providing a reasonable opportunity for hearing. All issues were kept open, and the appeal was allowed by way of remand.

This detailed analysis highlights the key arguments, findings, and directions given by the Tribunal in the legal judgment.