2017 (1) TMI 929 - AT - Service Tax

CENVAT credit - advertisement - tour operators service - denial on the ground that the sufficient documents have not been produced by the appellant - Held that - both these services fall in the definition of input service. Therefore, I allow the CENVAT credit on these two services subject to production of documents before the original authority. Short payment of tax - Held that - the appellant has tried to explain the reasons for short-payment vide his letter dated 22.9.2009 but the same has not been considered by both the authorities below. Therefore, this case needs to be remanded back to the original authority with a direction to pass de novo order after considering the explanation given by the appellant vide his letter dated 22.9.2009. Appeal allowed by way of remand.

Summary

Issues:
Appeal against order denying CENVAT credit on advertisement and tour operator service, confirming short-payment of service tax, and imposing penalty.

Analysis:
The appeal was against an order by the Commissioner (A) denying CENVAT credit on advertisement and tour operator service, confirming short-payment of service tax, and imposing a penalty. The appellant had been registered with the Service Tax Department since 2007 and was audited for the period from April 2004 to March 2009. The audit revealed short-payment of service tax and wrongly availed credit on rent paid to BBMP. The appellant contended that the short-payment was due to the impermissibility of levy on collections made before the levy was notified. The Commissioner (A) allowed credit for rent but denied it for advertisement and tour operator service, citing lack of sufficient documents. The appellant challenged this decision, arguing that the order was unsustainable in law as it did not address their explanations adequately. They claimed the denial of credit on advertisement and tour operator service was unjustified as they fell under the definition of input service. The appellant also argued that the extended period was wrongly invoked as there was no suppression or fraud, and objections raised during audit were explained satisfactorily.

The AR supported the impugned order, stating that the appellant's explanations were insufficient and justified the invocation of limitation based on audit findings. Several judgments were cited to support this position. After considering the arguments of both parties and reviewing the evidence, the Tribunal found the order rejecting CENVAT credit on advertisement and tour operator service to be incorrect. It allowed the credit on these services subject to the production of documents. Regarding the short-payment of service tax, the Tribunal noted that the appellant had provided explanations which were not considered by the lower authorities. As a result, the case was remanded back to the original authority for a fresh decision after considering the appellant's explanations. The original authority was directed to pass a new order within two months of receiving the certified copy of the decision.

In conclusion, the Tribunal set aside the impugned order and remanded the case back to the original authority for a fresh decision, allowing CENVAT credit on advertisement and tour operator service, and providing the appellant with an opportunity to present documents and explanations.