2019 (10) TMI 818 - AT - Service Tax

CENVAT credit - input services - Deposit Insurance - Credit Guarantee Corporation for insuring deposits - contrary disputes - HELD THAT - As there are contrary disputes on the issue, therefore, it would be in the interest of justice to refer the matter to the Larger Bench of this Tribunal to decide the issue. Registry is directed to place the papers before the Hon ble President to constitute a Larger Bench to decide the issue.

Summary

Issues involved: Appeal against denial of Cenvat credit on service tax paid to Deposit Insurance and Credit Guarantee Corporation for insuring deposits.

Analysis:
The appellant appealed against the impugned order denying Cenvat credit on service tax paid to Deposit Insurance and Credit Guarantee Corporation, arguing that it qualifies as an input service under Rule 2(l) of the Cenvat Credit Rules, 2004. The appellant's representative cited precedents from this Tribunal in cases like State Bank of Bikaner & Jaipur, Punjab National Bank, and DCB Bank Ltd to support their claim for allowing the Cenvat credit. On the other hand, the authorized representative for the respondent referred to a decision in the case of ICICI Bank & others vs. Commissioner, where it was held that the appellants are not entitled to avail Cenvat credit on insurance services provided by Deposit Insurance and Credit Guarantee Corporation.

After hearing both sides and noting the conflicting decisions, it was deemed necessary in the interest of justice to refer the matter to the Larger Bench of the Tribunal to decide the specific issue at hand: whether a banking company, like the appellant, is entitled to avail the Cenvat credit on service tax paid to Deposit Insurance and Credit Guarantee Corporation for insuring deposits. The Registry was directed to present the case before the Hon'ble President to constitute a Larger Bench for a final decision on this matter. The judgment was dictated and pronounced in open court by the designated members.