2015 (5) TMI 173 - AT - Service Tax

Mandap Keeper Service - benefit of Notification No. 1/2006-ST - Simultaneous availment of CENVAT Credit - Held that - Once CENVAT credit availed on common inputs/services are reversed, is considered as good as non-availment of CENVAT credit. The adjudicating authority sought to distinguish the case law cited before him only on the ground that the case laws were in respect of 'inputs' and not 'input services'. - once the assessee has reversed the CENVAT credit taken benefit of Notification No. 1/2006-ST cannot be denied. Respectfully, following the said ruling, we set aside the impugned order and allow the appeal filed by the appellant is, upholding the reversal of CENVAT credit by the appellant along with interest. - Decided in favour of assessee.

Summary

Issues: Stay petition for waiver of pre-deposit of service tax liability, availing benefit of Notification No. 1/2006-ST, reversal of CENVAT credit on common input services.

Analysis:
1. The stay petition was filed seeking waiver of pre-deposit of an amount confirmed as service tax liability, interest, and penalty. The Tribunal found that the appeal could be disposed of directly due to its narrow scope. The appellant had reversed the amount attributable to the CENVAT credit availed on common input services, which was deemed sufficient. Both parties consented to proceed without pre-deposit of the remaining amount.

2. The appellant was discharging service tax liability under 'Mandap Keeper Service' and had availed the benefit of Notification No. 1/2006-ST. The Revenue contended that the appellant was not eligible for the benefit due to availing credit on common input services. However, the appellant reversed the entire credit on common inputs and interest, informing the department accordingly. The Tribunal agreed with the appellant's compliance, stating that once CENVAT credit on common inputs/services is reversed, it is equivalent to non-availment of credit. The Tribunal referred to a previous ruling in Hindustan Construction Co. Ltd. case, where a similar view was upheld, allowing the benefit of the notification upon credit reversal.

3. The Tribunal rejected the adjudicating authority's attempt to distinguish between 'inputs' and 'input services' regarding the reversal of CENVAT credit. Citing the Hindustan Construction Co. Ltd. case, the Tribunal emphasized that once the appellant reversed the CENVAT credit, the benefit of Notification No. 1/2006-ST could not be denied. Consequently, the impugned order was set aside, and the appeal was allowed, affirming the appellant's reversal of CENVAT credit along with interest.

4. In conclusion, the Tribunal disposed of the appeal in favor of the appellant based on the reversal of CENVAT credit on common input services. The decision aligned with established legal principles and previous rulings, emphasizing the significance of compliance with credit reversal requirements to avail benefits under specific notifications.