Custom, Excise & Service Tax Tribunal
Cce, Jalandhar vs M/S.Mahavir Spinning Mills Ltd on 30 August, 2011
CUSTOMS, EXCISE & SERVICE TAX APPELLATE TRIBUNAL,
WEST BLOCK NO.II, R.K. PURAM, NEW DELHI-110066.
DIVISION BENCH
Service Appeal No.377 of 2008-ST
(Arising out of Order-in-Appeal No.138/CE/Appl/Jal/2008 dated 31.03.08 passed by the Commissioner of Customs, & Central Excise (A), Chandigarh)
Date of Hearing/Decision: 30.08.2011
For approval and signature:
Honble Mrs.Archana Wadhawa, Member (Judicial)
Honble Mr.Rakesh Kumar, Member (Technical)
1
Whether Press Reporters may be allowed to see the Order for publication as per Rule 27 of the CESTAT (Procedure) Rules, 1982?
2
Whether it should be released under Rule 27 of the CESTAT (Procedure) Rules, 1982 for publication in any authoritative report or not?
3
Whether Their Lordships wish to see the fair copy of the Order?
4
Whether Order is to be circulated to the Departmental authorities?
CCE, Jalandhar Appellant
Vs.
M/s.Mahavir Spinning Mills Ltd. Respondent
Present for the Appellant: Shri R.K.Gupta, SDR
Present for the Respondent: Shri Abhishek Singh Bhagat, Advocate
Coram: Honble Mrs.Archana Wadhawa, Member (Judicial)
Honble Mr.Rakesh Kumar, Member (Technical)
ORDER NO._______________
PER: ARCHANA WADHWA
Being aggrieved with the order passed by the Commissioner (Appeals), the Revenue has filed the present appeal. We have heard Rajendra Gupta, learned SDR for the Revenue and Shri Abhishek Singh Bhagat, learned Advocate appearing for the respondents.
2. As per the facts on records, the respondents are engaged in the manufacture of cotton yarn and man made fabric. They were availing GTA services and during the relevant period were liable to pay service tax, as recipient of said service, in terms of provisions of Rule 2 (1) (d) (v) of Service Tax Rules, 1994. As such the service tax paid by them was being available as cenvat credit and utilized for payment of duty.
3. The Revenue entertained a view that the GTA service, on which they have paid service tax as recipient, cannot be considered to be input service so as to avail cenvat credit of the same and utilise the same towards payment of duty. Accordingly, proceedings were initiated against them for confirmation of demand of service tax by denying the credit which resulted in passing an order by the original adjudicating authority.
4. On appeal, the Commissioner (Appeals), by following the Tribunals decision in the case of CCE, Chandigarh vs. Nahar Industrial Enterprises Ltd. reported in 2007 (7) STR 26 (Tri.-Del.) held in favour of the assessee. The present appeal of the Revenue is on the sole ground that the Tribunals order does not stand accepted by the Department and appeal has been filed against the order of the appellate authority before Honble Punjab & Haryana High Court which is pending.
5. We find that the Revenues appeal before the Honble Punjab & Haryana High Court stands decided vide their order dated 6.5.2010. It stands held by Honble Punjab & Haryana High Court that the service tax paid out of cenvat credit of GTA services received is in accordance with law and the Tribunal has rightly held that the assessee was entitled to pay service tax from the cenvat credit so availed. Inasmuch as the issue stands decided by Honble Punjab & Haryana High Court, approving the Tribunals decision, we find no reason to interfere in the impugned order of the Commissioner (Appeals). The Revenues appeal is accordingly rejected.
(Pronounced in the open court) (ARCHANA WADHAWA) MEMBER (JUDICIAL) (RAKESH KUMAR) MEMBER (TECHNICAL) mk 4