2014 (8) TMI 664 - AT - Service Tax

Input service credit - repair, maintenance and manpower recruitment services - Held that - applicant has made out a prima facie case in their favour as these services have been availed by the applicant as manufacturer in the course of their business. Accordingly, we waive the pre-deposit of the entire amount of duty, interest and penalty and stay recovery during the pendency of the appeal. - Following decision of Commissioner of Central Excise, Nagpur v. Ultratech Cement Ltd. 2010 (10) TMI 13 - BOMBAY HIGH COURT - Stay granted.

Summary

Issues:
1. Input service credit on repair, maintenance, and manpower recruitment services related to tugs and barges.
2. Applicability of the decision of the Hon'ble High Court of Bombay in Commissioner of Central Excise, Nagpur v. Ultratech Cement Ltd.
3. Opposition based on the decision in Vikram Ispat v. CCE, Raigad.
4. Prima facie case for waiver of pre-deposit and stay on recovery during appeal.

Analysis:

1. The applicant sought input service credit on services related to repair, maintenance, and manpower recruitment for tugs and barges used in transporting goods to the mother vessel. The Tribunal considered the nature of these services in connection to the applicant's manufacturing business.

2. The learned Counsel referred to the decision of the Hon'ble High Court of Bombay in Commissioner of Central Excise, Nagpur v. Ultratech Cement Ltd., emphasizing that any service availed for the business of manufacturing entitles the assessee to input service credit. This argument was pivotal in requesting a stay on the impugned demands pending appeal.

3. The opposition to the applicant's claim was based on the decision in Vikram Ispat v. CCE, Raigad, citing a different perspective on the issue. The Revenue contended that the balance of convenience favored pre-deposit of the entire amount, challenging the applicant's entitlement to the credit.

4. After hearing both sides, the Tribunal acknowledged the precedence of the Hon'ble High Court of Bombay's decision over its own and found that the applicant had established a prima facie case in their favor. Consequently, the Tribunal waived the pre-deposit of duty, interest, and penalty, and ordered a stay on recovery during the pendency of the appeal, aligning with the interpretation of the High Court's ruling.

This detailed analysis of the judgment highlights the key issues raised, the legal arguments presented, and the Tribunal's decision based on the precedents and merits of the case.