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2013 (6) TMI 236 - AT - Service TaxUtilization of cenvat credit for discharge of service tax on the GTA services - FAA had directed the appellant to deposit the entire amount of the service tax liability along with interest and penalty for hearing and disposing the appeal - Held that - The issue involved in this case is prior to 01.03.08. Prior to issuance of the notification No.10/08-CE (NT) dated 01.03.08, there are various decisions which have held that the assessee is eligible to utilise the cenvat credit for the discharge of service tax liability on the GTA services. Thus this decided ratio will be applicable in this case. Set aside the impugned order and remand the matter back to the FAA to reconsider the issue afresh and pass an order on merits without insisting any amounts as pre-deposit. Appeal is allowed by way of remand.
Issues:
1. Non-compliance of pre-deposit for appeal. 2. Utilization of cenvat credit for service tax on GTA services. 3. Direction to deposit entire service tax liability for appeal. Issue 1: Non-compliance of pre-deposit for appeal The first appellate authority rejected the appeal due to the appellant's failure to comply with the pre-deposit order. The Tribunal found that the appeal could be disposed of at that stage. The application for waiver of pre-deposit was allowed, and the appeal was taken up for disposal. Issue 2: Utilization of cenvat credit for service tax on GTA services The issue in this case revolved around the utilization of cenvat credit for discharging service tax on GTA services received by the appellant. The Tribunal noted that prior to 01.03.08, decisions had allowed the use of cenvat credit for such tax liabilities. Despite this, the first appellate authority had not decided on the merits of the case. Therefore, the Tribunal set aside the order and remanded the matter for reconsideration without requiring any pre-deposit. The first appellate authority was instructed to follow principles of natural justice in reaching a conclusion. Issue 3: Direction to deposit entire service tax liability for appeal The first appellate authority had directed the appellant to deposit the entire service tax liability, along with interest and penalty, for the appeal to be heard. However, since the issue was prior to 01.03.08 and the cenvat credit utilization had legal precedence, the Tribunal set aside the order and remanded the case for a fresh consideration on merits without insisting on any pre-deposit amount. The appeal was allowed by way of remand. This judgment highlights the importance of complying with pre-deposit orders, the utilization of cenvat credit for service tax liabilities, and the need for appellate authorities to consider all legal aspects before making decisions.
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