2013 (10) TMI 254 - AT - Service Tax

CENVAT Credit Waiver of Pre-deposit - Whether the CENVAT Credit is admissible to the appellant on the services availed with respect to document processing service charges incurred with respect to the processing of appellants rebate claim Held that - The period involved in this appeal is from November 2010 to April 2011, which is before 01.04.2011 when the definition of input services given in CENVAT Credit Rules was changed where certain specific services were excluded from the ambit of the input services - It has been interpreted by the Courts that the scope of input services given before 01.04.2011 was very wide - Appellant has made out a prima facie case for complete waiver of the amounts and penalty Stay granted.

Summary

Issues:
Admissibility of CENVAT Credit on document processing service charges for rebate claim.

Analysis:
The appeal before the Appellate Tribunal CESTAT Ahmedabad revolves around the question of whether the appellant is entitled to CENVAT Credit on services related to document processing service charges for the processing of a rebate claim. The appellant's counsel argued that the processing of the rebate claim is crucial for the flow of funds required for manufacturing activities, thus constituting a service related to manufacturing. The counsel cited various case laws to support this argument, emphasizing the importance of allowing CENVAT Credit for services directly or indirectly linked to manufacturing processes or clearance of final products. The Mumbai High Court's judgment in Coca Cola India Pvt.Ltd Vs. CCE Pune-III was particularly highlighted to underscore the categories of services for which CENVAT Credit should be permitted.

The Revenue, represented by the Additional Commissioner, maintained the stance taken by the adjudicating authority and the first appellate authority. After hearing both parties and examining the case records, the Tribunal considered the period of the appeal from November 2010 to April 2011, noting that the definition of input services under the CENVAT Credit Rules had been amended post-April 2011 to exclude certain services. The Tribunal acknowledged the broad scope of input services before the amendment and found that the appellant had established a prima facie case for a complete waiver of the confirmed amounts, interest, and penalties. Consequently, a stay was granted on the recovery of the dues, interest, and penalties until the appeal is disposed of.

In conclusion, the Appellate Tribunal, through the judgment delivered by Mr. H.K. Thakur, granted a stay on the recovery of confirmed amounts, interest, and penalties concerning the admissibility of CENVAT Credit on document processing service charges for the rebate claim. The decision was based on the interpretation of the input services definition applicable during the relevant period, emphasizing the importance of the services in relation to manufacturing activities and the broad interpretation of input services before the regulatory amendment.