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TMI Blog2017 (9) TMI 280X X X X Extracts X X X X X X X X Extracts X X X X ..... in - recovery of credit set aside - decided in favor of assessee. - Central Excise Appeal No. 11 of 2013 - - - Dated:- 2-2-2017 - Sudhir Agarwal and Ravindra Nath Mishra-II, JJ. Shri Sudeep Kumar, Counsel, for the Appellant. Shri Dipak Seth, A.S.G. and Sunil Sharma, for the Respondent. ORDER Heard Sri Sudeep Kumar, learned counsel for appellant and Sri Dipak Seth, counsel for respondents. 2. This appeal under Section 35G of Central Excise Act, 1944 (hereinafter referred to as Act 1944 ) has arisen from judgment and order dated 1-3-2013 passed by Customs, Excise Service Tax Appellate Tribunal, Principal Bench, New Delhi (hereinafter referred to as Tribunal ) in ST/ROM/4755/2012 [2017 (52) S.T.R. 445 (Tri. - Del.)] whereby application for review/modification of order dated 30-7-2012 passed in ST Appeal No. 649/2010-SM has been rejected. Assessee appellant s appeal against recovery of Cenvat credit of ₹ 4,04,179/- has been rejected vide order dated 30-7-2012. 3. This appeal was admitted on following substantial question of law :- Whether the appellant can be said to be Provider of any output services and is entitled for utilization of Cenv ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ) in respect of any taxable service notified by the Central Government in the Official Gazatte, the service tax thereon shall be paid by such person and in such manner as may be prescribed at the rate specified in Section 66 and all the provisions of this chapter shall apply to such person as if he is the person liable for paying the service tax in relation to such service. 10. Central Government enacted Cenvat Credit Rules, 2004 (hereinafter referred to as Rules 2004 ) vide Notification dated 10-9-2004. Assessee is availing credit of Central Excise paid on Inputs and Capital Goods and service tax paid on Input Services under Rules, 2004 for further payment of duty. Assessee was availing services of GTA and paying service tax on the same as recipient of the said service. Assessee thus, paid Services Tax by availing Cenvat credit of duty paid on Inputs , Capital Goods and Service Tax on Input Services . The term output service person liable for paying service tax and provider of taxable service are defined in Rule 2(p)(q) and (r) of Rules, 2004 and read as under :- 2. Definitions - In these rules, unless the context otherwise requires, 2(p) output servic ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... demand of recovery of Cenvat credit. Assessee also filed a review application but the same has also been rejected. 13. The entire approach of Excise authorities as well as Tribunal is founded on deletion of Explanation from Rule 2(p) of Rules, 2004 w.e.f. 19-4-2006 holding that this Explanation is a kind of exception and its deletion would render assessee liable to pay in cash and not to utilize Cenvat credit. This issue has been considered by various Tribunals and High Courts and there appears some diversion of opinion. 14. In Commissioner of C. Ex., Indore v. Spendex Industries Ltd., 2013 (31) S.T.R. 472, Tribunal s Bench at Delhi has observed that deletion of Explanation w.e.f. 19-4-2006 would not make much difference. Assessee being recipient of GTA is liable to pay Service Tax as provider of taxable service in terms of Rule 2(r) of Rules, 2004 and consequently gets covered by Output Service definition contained in Rule 2(p) of Rules, 2004. Similar view was taken by Tribunal s Bench at New Delhi in Shree Rajasthan Syntex Ltd. v. CCE, Jaipur, 2011 (24) S.T.R. 670. Following judgment of Delhi Bench, Tribunal s Chennai Bench in Commissioner of Service Tax, Chennai v. Roya ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the Taxation of Services (Provided from Outside India and Received in India) Rules. We find that rule 5 refers to availing of Cenvat credit and not to utilization of credit. We are therefore of the view that the finding of the Commissioner not treating the appellant as output service provider, is not correct and accordingly we set aside the impugned order and allow the appeal. 5.3 In view of the above decisions of the various High Courts, the decisions of the Tribunal relied upon by the Revenue become irrelevant. Accordingly, we hold that the appellants in present appeals were entitled to utilize Cenvat credit of the service tax paid on various input services for discharge the service tax liability on the output service of Insurance Auxiliary Service . (emphasis added) 16. Ahmedabad Bench of Tribunal in Panchmahal Steel Ltd. v. Commissioner of C. Ex. S.T., Vadodara, 2014 (34) S.T.R. 351, has also taken same view and observed that prior to 1-3-2008 there was no bar for such utilization and Assessee could have utilized Cenvat credit given to them for payment of Service Tax on GTA service. It followed Delhi High Court judgment in CST v. Hero H ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y part of India; (III) any co-operative society established by or under any law; (IV) any dealer of excisable goods, who is registered under the Central Excise Act, 1944 (1 of 1944) or the rules made thereunder; (V) any body corporate established, by or under any law; or (VI) any partnership firm whether registered or not under any law including association of persons; any person who pays or is liable to pay freight either himself or through his agent for the transportation of such goods by road in a goods carriage : Provided that when such person is located in a non-taxable territory, the provider of such service shall be liable to pay service tax. (C) In relation to service provided or agreed to be provided by way of sponsorship to anybody corporate or partnership firm located in the taxable territory, the recipient of such service; (D) In relation to service provided or agreed to be provided by, - (I) an arbitral tribunal, or (II) an individual advocate or a firm of advocates by way of legal services, to any business entity located in the taxable territory, the recipient of such service; (E) In relat ..... X X X X Extracts X X X X X X X X Extracts X X X X
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