CENVAT credit on service tax paid by job worker upheld prima facie; pre-deposit waived and recovery stayed.

CENVAT credit was prima facie held admissible where a job worker had discharged service tax, was registered, and issued invoices for paid consideration. In the absence of any action against the job worker or any finding that the tax paid was not service tax, denial of credit to the appellant was considered unsustainable at the stay stage. The job worker's exemption under Notification No. 8/2005-ST did not, on these facts, justify denial of credit to the appellant. Waiver of pre-deposit and stay of recovery were therefore granted till disposal of the appeal.

---

---

Issues: Whether the appellant was entitled to waiver of pre-deposit and stay of recovery in respect of the demand relating to denial of CENVAT credit on service tax paid by the job worker.

Analysis: The job worker had discharged service tax, was registered with the department, and had issued invoices against which consideration had been paid. In the absence of any action against the job worker or any finding that the tax paid by him was not service tax, the denial of credit to the appellant was found to be prima facie unsustainable. The exemption available to the job worker under Notification No. 8/2005-ST did not, at this stage, justify denial of credit to the appellant.

Conclusion: The appellant was held entitled to waiver of pre-deposit and stay of recovery till disposal of the appeal.

---