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TMI Blog2025 (1) TMI 148X X X X Extracts X X X X X X X X Extracts X X X X ..... for availing CENVAT Credit on tax paid in terms of Deposit Insurance Act, is assailed by Appellant banking company before this forum. 2. Fact of the case, in a nut shell, is that Appellant is a banking company governed under Banking Regulation Act, 1949 and it has been providing taxable services of banking and other financial services as well as discharging applicable Service Tax thereon under the Finance Act, 1994. Under the Deposit Insurance and Credit Guaranteed Corporation Act, 1961, which is commonly known as Deposit Insurance Act, banking companies are required to insure the deposits made by its customers/depositors in the Deposit Insurance Credit Guarantee Corporation, a Government of India enterprise so as to protect deposits of cu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sed on 30.04.2024 in the case of Bank of Ameriaca, National Association & Others Vs. Principal Commissioner, CGST & Central Excise, Mumbai & Commissioner of Service Tax-V, Mumbai reported in 2024 (4) TMI 1149 - CESTAT Mumbai has argued that issue is no more res integra since Larger Bench has already given its finding that Service Tax paid towards such insurance deposit services were meant for fulfilment of legal requirement without which taxable service cannot be provided and therefore, it was opined by the Tribunal in the above referred decisions that such services received by Appellant would fall within the main part of the definition of input services and credit in respect of the same should be available. He further argued that not only ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ecord and the precedent decisions passed on the issue. It is, worth-noting, that Mumbai Bench of this Tribunal had expressed its apprehension on the precedent value of South Indian Bank Larger Bench decision for the reason that observations of Hon'ble Supreme Court in several other cases including that of Commissioner of Customs (Import), Mumbai Vs. M/s Dilip Kumar and Company & Ors. Judgment, [2018 (7) TMI 1826 - SUPREME COURT] concerning strict interpretation of taxation statute was not considered, for which suggestion was made for a reference to a still Larger Bench comprising of Five Members but that was negated by the same Three Members Larger Bench with reasoning noted in the said decision including affirmation of the decision of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nnection with both the "accepting" of deposits and "lending" activity of the banks. Banks would be able to lend only if they accept deposits. It has been seen that without payment of insurance premium on the outstanding deposits, banks will not be able to function or render any output service of "banking and other financial services" and the licence granted to the banks by the Reserve Bank of India can be cancelled. 53. Thus, the service rendered by the Deposit Insurance Corporation to the banks would fall in the main part of the definition of "input service", which is any service used by a provider of output service for providing an output service. Once this service falls in the main part of the definition of "Input service", it would n ..... X X X X Extracts X X X X X X X X Extracts X X X X
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