Appellant's CENVAT credit challenge upheld, service tax liability waived on leased aircraft, maintenance tax recovery stayed.

The appellant challenged the reversal of CENVAT credit on ineligible documents and reversed the entire amount with interest. The Tribunal deemed this sufficient for the appeal. Regarding the liability to pay service tax on leased aircraft, the appellant demonstrated control over the aircraft, leading to a waiver. For renting out aircraft, the appellant's service was classified as 'air transport service,' granting a waiver. Concerning service tax on maintenance, a waiver was granted due to potential double taxation if service tax was already paid by another entity. Recovery was stayed during the appeal.

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Issues involved:
1. Eligibility for CENVAT credit on ineligible documents.
2. Liability to pay service tax on leased aircrafts.
3. Liability to pay service tax on renting out aircrafts.
4. Liability to pay service tax on maintenance or repair of aircrafts.

Issue 1: Eligibility for CENVAT credit on ineligible documents
The appellant challenged the decision regarding the reversal of CENVAT credit on ineligible documents amounting to Rs.55,50,368/-. The appellant reversed the entire amount of CENVAT credit with interest and appropriated the amount. The Tribunal considered the reversal of CENVAT credit with interest as sufficient for the purpose of pre-deposit to hear the appeal.

Issue 2: Liability to pay service tax on leased aircrafts
The question was whether the appellant is liable to pay service tax of Rs.2,73,62,486/- on aircrafts leased from a foreign company, considering it as receiving the service of supply of tangible goods. The appellant demonstrated that they retained possession and control of the aircraft during the lease period, establishing a prima facie case. Therefore, a waiver was granted in this regard.

Issue 3: Liability to pay service tax on renting out aircrafts
The issue revolved around whether the appellant should pay service tax for renting out aircrafts to various companies. The department viewed these transactions as 'supply of tangible goods,' while the appellant argued it falls under 'air transportation service.' Citing a Tribunal decision, the appellant's service was classified as 'air transport service,' warranting a waiver of pre-deposit for the demand of Rs.3,47,62,486/-.

Issue 4: Liability to pay service tax on maintenance or repair of aircrafts
The appellant contested the liability to pay service tax on the maintenance or repair of aircrafts from 1.1.2008 to 7.10.2008. The argument was based on the payment of service tax by another entity for the same services, the operational status of M/s. Deccan Charters Ltd., and the effective date as per the agreement and statutory provisions. The Tribunal acknowledged the complexity of the issue, emphasizing that if service tax was already paid for the same service, the appellant should not be subject to double taxation. Consequently, a waiver of pre-deposit was granted for all dues, and a stay against recovery was ordered during the appeal's pendency.

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