2009 (12) TMI 185 - AT - Service Tax

Cenvat Credit- the adjudicating authority confirmed the demand of Rs. 2,92,47,275 after allowing the Cenvat credit on service tax paid on telephone services, courier services and AMC services. It is the submission that the adjudicating authority has failed to consider the evidence which had been produced by the appellant before him as regards the service tax paid which are categorized as other charges . He drew our attention to various evidence produced before the adjudicating authority. It is the submission that as regards reversal of service tax of Rs. 9.83 crores, they have paid interest also. They are not challenging the same. Held that- In view of this, we set aside the impugned order to the extent it confirms the reversal of Cenvat credit of Rs. 2.92 crores and allow the appeal by way of remand to the adjudicating authority for a fresh decision after appreciating the evidence placed before him during the de novo proceedings. The appellant shall be given an opportunity of personal hearing. The stay application and the appeal are disposed of by way of remand.

Summary

Issues Involved: Stay petition against waiver of pre-deposit of service tax amount, interest, and penalty under sections 76, 77 and rule 15 of Cenvat Credit Rules, 2004. Eligibility of Cenvat credit on service tax paid on various services received by appellants at regional offices nationwide.

Analysis:
1. The stay petition challenged the waiver of pre-deposit of a substantial service tax amount, interest, and penalty. The primary issue revolved around the eligibility of Cenvat credit on service tax paid for services received at regional offices across India.

2. The appellant contended that the adjudicating authority confirmed a significant demand after allowing Cenvat credit on specific services like telephone, courier, and AMC services. However, the authority allegedly overlooked evidence presented regarding service tax payments categorized as "other charges," totaling Rs. 9.83 crores, which included interest paid.

3. The respondent argued that the evidence now presented before the Tribunal was not initially provided to the adjudicating authority for consideration, implying a lack of due process in the assessment.

4. In response, the appellant claimed that the evidence in question was indeed submitted to the adjudicating authority, but it was purportedly disregarded during the decision-making process.

5. The Tribunal found that the appeal could be resolved promptly as the core issue was narrowly defined. After waiving the pre-deposit amounts, the appeal was taken up for disposal.

6. Upon reviewing submissions and evidence, the Tribunal determined that the entire demand arose due to the appellant's failure to provide a breakdown of "Other charges." The adjudicating authority's denial of Cenvat credit was based on this lack of detailed explanation, despite evidence being available. Consequently, the impugned order confirming the reversal of Cenvat credit was set aside, and the appeal was remanded for a fresh decision, allowing the appellant a personal hearing during the proceedings. The stay application and appeal were disposed of through remand for further assessment.