2019 (7) TMI 332 - AT - Service Tax

CENVAT Credit - input services - Works Contract Service - Membership of Clubs - Event Management - Construction of Residential Complex Service - Commercial Construction Service - Credit Card Services - International Air Travel Agent Event Management Services - HELD THAT - The Appellant must produce the documents in support of the aforesaid submissions, which the Appellant was ready to produce before me, but the said documents needs to be verified. The adjudicating authority is the appropriate authority to verify these documents. Matter remanded to the adjudicating authority for de novo adjudication with a direction to pass the order after giving a reasonable opportunity of hearing to the Appellants to present their case - appeal allowed by way of remand.

Summary

Issues:
- Availment of Cenvat credit for ineligible services
- Delay in passing the order
- Failure to consider additional written submissions
- Need for de novo adjudication

Availment of Cenvat credit for ineligible services:
The Appellant, registered for service tax under various categories, availed Cenvat credit for services not eligible as input services under the Cenvat Credit Rules, 2004. A show cause notice was issued demanding service tax for the years 2007-08 to 2010-11. Subsequently, another notice was issued for the year 2011-12 based on the average of disallowed credit for the previous years. The Order-In-Original confirmed the demand of service tax, interest, and penalty.

Delay in passing the order:
The Appellant argued that the delay of seven and a half months between the personal hearing and the order's issuance rendered the order legally unsustainable. They contended that the delay caused confusion for the Commissioner, leading to errors in the order. The Appellant submitted additional written submissions, highlighting discrepancies in the demanded amount versus the actual input services amount, but the Commissioner did not address these submissions in the order.

Failure to consider additional written submissions:
The Appellant's additional written submissions pointed out that the total amount of input services referred to in the show cause notice was significantly lower than the demanded amount. Despite this, the Commissioner confirmed the demand without discussing or rejecting these submissions. The Appellant requested more time to provide additional details, but the order was issued before this could be done.

Need for de novo adjudication:
The Tribunal found the order unsustainable due to the Commissioner's failure to consider the additional written submissions. While acknowledging the delay in passing the order was unreasonable, the Tribunal did not set aside the order solely based on the delay. Instead, the matter was remanded to the adjudicating authority for a fresh adjudication, emphasizing the importance of giving the Appellants a reasonable opportunity to present their case and produce supporting documents.

This detailed analysis of the judgment highlights the issues involved, the arguments presented by both parties, and the Tribunal's decision to remand the matter for de novo adjudication, ensuring fairness and adherence to legal principles.