2024 (4) TMI 1040 - AT - Service Tax

Payment through CENVAT credit not accepted - supporting documents furnished were also not referred - HELD THAT - There are no doubts as to the availability of CENVAT credit in the books of the appellant. But however the lower authority has brushed aside the request of the appellant which is borne on record but it was incumbent upon the original authority discharging the role of an adjudicating authority to verify/cross verify and then give proper findings through speaking order as to whether the claims of the appellant were acceptable or not. It is precisely the case of the appellant that they had discharged service tax liability to a larger extent through credit balance but however the original authority has ignored the claims of the appellant which is not in accordance with law. Further it is not even the case of the Revenue that the claims of the appellant were wrong insofar as the availability and the utilization thereof CENVAT credit towards the payment of their service tax liability however as contended by the learned Advocate there may be a slight delay for which statutory provisions are available to safeguard the interest of the revenue. If the stand of the appellant is to be accepted upon verification then the demand once again would amount to double taxation which is not the spirit of the taxing statute. In that view of the matter it is deemed most appropriate to set aside the impugned order and remit matter back to the file of the original authority for de-novo adjudication who verify the claims of the appellant and thereafter pass a speaking order in accordance with law. Appeal is allowed by way of remand.

Summary

Issues involved: Dispute regarding service tax liability for the period 2007-2008 to 2010-2011, utilization of CENVAT credit for payment of service tax, rejection of CENVAT credit payment by the original authority.

Summary:

Issue 1: Dispute over service tax liability
The appellant, engaged in broadcasting services, had availed credit of service tax paid on input services and used it for service tax payment. The Revenue issued a Show Cause Notice proposing a demand of Rs. 66,78,141 for the period in question. The appellant claimed to have remitted the remaining service tax liability after utilizing CENVAT credit, providing a detailed reconciliation statement. The original authority did not accept the payment through CENVAT credit, leading to the appeal.

Issue 2: Rejection of CENVAT credit payment
The appellant contended that the original authority did not consider their claims and supporting documents regarding the utilization of CENVAT credit. The appellant requested a remand for de-novo adjudication to consider the evidence. The Assistant Commissioner supported the original authority's findings but had no objection to a remand.

Judgment:
The Tribunal found that the original authority unjustly ignored the payment through CENVAT credit. Despite evidence of available CENVAT credit, the authority failed to verify the appellant's claims properly. The Tribunal noted that the appellant had discharged a significant portion of the service tax liability through credit balance. The original authority's disregard of the appellant's claims was deemed contrary to law. As there was no indication of incorrect claims by the appellant, the demand could lead to double taxation. Therefore, the impugned order was set aside, and the matter was remanded for de-novo adjudication to verify the appellant's claims and issue a speaking order. The appellant was granted a fair hearing, and the original authority was directed to complete the adjudication within 60 days. All issues and contentions were left open.