Custom, Excise & Service Tax Tribunal
Yes Bank Ltd vs Commr Service Tax- I Mumbai on 15 September, 2020
CUSTOMS, EXCISE & SERVICE TAX APPELLATE TRIBUNAL
MUMBAI
REGIONAL BENCH - COURT NO. 02
Service Tax Miscellaneous Application (EH) No. 85235 of 2020
(on behalf of Appellant)
in
Service Tax Appeal No. 86654 of 2016
(Arising out of Order-in-Original No. 81/STC-I/SM/15-16 dated 29.03.2016 passed
by Commissioner of Service Tax-I, Mumbai)
M/s Yes Bank Ltd. .....Appellant
Tower-2 17th Floor Indiabulls Finance Centre,
Senapati Bapat Marg, Elephinston Road,
Mumbai - 400 013.
VERSUS
Commissioner of Service .....Respondent
Tax-I, Mumbai Commissioner of Service Tax-I Mumbai, 5th Floor, New Central Excise Building, Maharshi Karve Road Churchgate, Mumbai - 400 020.
Appearance:
Shri Prasad Paranjape with Shri Sanjeev Nair, Advocates for the Appellant Shri Nitin Tagade, Authorized Representative for the Respondent CORAM:
HON'BLE MR. S.K. MOHANTY, MEMBER (JUDICIAL) HON'BLE MR. SANJIV SRIVASTAVA, MEMBER (TECHNICAL) FINAL ORDER NO. A/85799/2020 Date of Hearing: 15.09.2020 Date of Decision: 15.09.2020 Application No. ST/Eh/85235/2020 Appeal No. ST/86654/2016 2 PER : S.K. MOHANTY Heard both sides and perused the records.
2. The applicant-appellant has filed the miscellaneous application, seeking for early hearing of appeal. On perusal of the averments made therein, we are of the view that the prayer made therein can be considered in the interest of justice. Accordingly, the miscellaneous application for early hearing of appeal is allowed and with the consent of both sides, the appeal is taken up for hearing and disposal today.
3. The appellant M/s. Yes Bank Ltd. has filed this appeal against the impugned order dated 29.03.2016 passed by the Ld. Commissioner of Service Tax-I, Mumbai, wherein service tax demand of Rs.6,86,10,057/- was confirmed along with interest and equal amount of penalty was imposed on the appellant.
4. Briefly stated, the facts of the case are that the assessee- appellant is engaged in the business of providing Banking and Other Financial Service (BOFS), defined under Section 65 of the Finance Act, 1994. During the disputed period, the assessee-appellant had availed cenvat credit of service tax paid on Deposit Insurance Service provided by DICGC, considering the same as input service, defined under Rule 2(l) of the Cenvat Credit Rules, 2004. Availment of Cenvat Credit was disputed by the department inter alia, on the ground that such services have no nexus or connectivity with the actual performance of the banking service provided by the assessee-appellant.
5. We find that the issue with regard to availment of cenvat credit on the disputed service was highly debatable and there were conflicting views by different benches of the Tribunal. For resolving the dispute, the Larger Bench was constituted. In the case of South Indian Bank Vs. Application No. ST/Eh/85235/2020 Appeal No. ST/86654/2016 3 Commissioner of Customs, Central Excise & Service Tax, Calicut, the Larger Bench of the Tribunal vide order dated 20.03.2020, reported in 2020-TIOL-861-CESTAT-BANG-LB has answered the reference in the following terms:
"The insurance service provided by the Deposit Insurance Corporation to the banks is an "input service" and CENVAT credit of service tax paid for this service received by the banks from the Deposit Insurance Corporation can be availed by the banks for rendering 'output services'."
6. In view of the above decision of the Larger Bench, the issue arising out of the present dispute regarding availment of the Cenvat credit on Deposit Insurance Service provided by DICGC is no more res integara. Therefore, by setting aside the impugned order, the appeal is allowed in favour of the appellant.
(Operative part of the order pronounced in the open court) (S.K. Mohanty) Member (Judicial) (Sanjiv Srivastava) Member(Technical) Sm