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2017 (9) TMI 886 - AT - Service TaxExcess baggage charges - demand of service tax - Held that - Excess baggage charges while transporting the passenger recovered as Excess baggage charges have been held not liable for service tax by this Tribunal in the case of Kingfisher Airlines Limited v. CST 2015 (11) TMI 54 - CESTAT MUMBAI (LB) . CENVAT credit - credit availed prior to registration during the period April 2006 to February 2007 - Held that - the said issue has been dealt by the M Portal India Wireless Solutions P. Ltd. v. CCE 2011 (9) TMI 450 - KARNATAKA HIGH COURT , wherein it has been held that being a service provider, if any Cenvat credit is availed on input service or capital goods by the assessee, the assessee is entitled to avail Cenvat credit on the said input/input service are being used for supply of taxable service - credit allowed - pre-deposit waived. Valuation - includibility - inclusion of reimbursement of insurance charges paid to the foreign service provider for providing pilots to the applicant - Rule 5(1) of the service tax Rules 2006 - Held that - As the said provision has been struck out by the Hon ble Delhi High court in the case of Intercontinental Consultants & Technocrats Pvt. Ltd. v. UOI 2012 (12) TMI 150 - DELHI HIGH COURT , therefore, the applicant has made out a case complete waiver of pre-deposit on this ground. The applicant has made out a case of complete waiver of pre-deposit - appeal allowed.
Issues:
1. Liability for service tax on excess baggage charges. 2. Denial of Cenvat Credit availed prior to registration. 3. Taxability of reimbursement of insurance charges paid to foreign service provider. Analysis: Issue 1: Liability for service tax on excess baggage charges The Tribunal referred to the case of Kingfisher Airlines Limited v. CST and the subsequent decision by the Hon'ble Apex Court in the case of Jet Airways India Limited, where it was held that excess baggage charges recovered while transporting passengers are not liable for service tax. Consequently, the Tribunal found that the appellant is not liable to pay service tax under the category of excess baggage charges. Issue 2: Denial of Cenvat Credit availed prior to registration The Tribunal discussed the case of M Portal India Wireless Solutions P. Ltd. v. CCE, where it was established that a service provider is entitled to avail Cenvat credit on input services or capital goods if they are used for supplying taxable services, even if the registration with the Service Tax Department was pending at the time of availing the credit. The Tribunal noted that the appellant had already paid a significant amount of the demanded sum, which was deemed sufficient for a waiver of pre-deposit. Issue 3: Taxability of reimbursement of insurance charges Regarding the inclusion of expenses for reimbursement of medical insurance for pilots provided by a service provider in taxable service under Rule 5(1) of the service tax Rules 2006, the Tribunal cited the case of Intercontinental Consultants & Technocrats Pvt. Ltd. v. UOI, where the provision was struck down by the Hon'ble Delhi High Court. As a result, the Tribunal found that the appellant had successfully demonstrated a case for complete waiver of pre-deposit on this ground. In conclusion, the Tribunal held that the appellant had sufficiently made a case for a complete waiver of pre-deposit, thereby waiving the requirement of pre-deposit for the balance amount of service tax, interest, and penalty, and staying the recovery thereof during the pendency of the appeal.
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