Service Tax Demand Upheld with Partial Relief on Input Credit

The judgment confirmed a service tax demand of Rs. 12,63,598/- against the applicant for the period 10/09/2004 to 31/03/2009, with interest and penalty. The applicant's contention regarding not availing input service credit led to a potential reduced liability of approximately Rs. 1.42 lakhs. A waiver of pre-deposit was granted due to the applicant's prior payment, with the tribunal remanding the case for verification of Cenvat credit availability. The tribunal directed cooperation with the adjudicating authority for this specific verification purpose.

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Issues:
Service tax demand confirmation, availing input service credit, waiver of pre-deposit, remand for verification of Cenvat credit availability.

Service Tax Demand Confirmation:
The judgment confirms a service tax demand of Rs. 12,63,598/- against the applicant for the period 10/09/2004 to 31/03/2009, along with interest and penalty under Section 78 of the Finance Act, 1944.

Availing Input Service Credit:
The applicant contended that they did not avail input service credit during the period in question. If considered admissible, the liability would reduce to approximately Rs. 1.42 lakhs. The applicant had already paid Rs. 3,07,093/- along with interest of Rs. 69,410/-, requesting a stay be granted.

Waiver of Pre-Deposit:
Considering that the applicant did not avail credit during the period, the liability would reduce to Rs. 1.42 lakhs. As the applicant had already paid a substantial amount, the tribunal granted a waiver of pre-deposit for the balance amount of service tax, interest, and penalty under Section 78 of the Finance Act, 1944, during the appeal's pendency.

Remand for Verification of Cenvat Credit Availability:
The tribunal observed that Cenvat credit was available to the appellants. Consequently, the matter was remanded back to the original adjudicating authority to determine the amount of credit available and adjust the demand accordingly. The appellant was directed to cooperate with the adjudicating authority for this purpose, with the remand being limited to this specific verification.

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