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of <h1>Partial stay granted in case involving waiver of pre-deposit & recovery of Rs. 1,71,370 with interest and penalty.</h1> <h3>SUDARSHAN CHEMICAL INDUSTRIES LTD. Versus COMMISSIONER OF C. EX., RAIGAD</h3> The Member (T) granted a partial stay in a case involving a waiver of pre-deposit and recovery of Rs. 1,71,370/- with interest and penalty. The dispute ... Waiver of pre-deposit - Cenvat credit on various input services - Held that:- Applicant has a strong case in their favour in respect of outward courier services, Rent-a-cab services and Tour and Travel services on the basis of decision of the Tribunal and High Court cited above. I find that the Architectural Consultancy service which is used for guest houses and conference prima facie is not connected to the manufacturing of final product - stay granted partly. Issues:- Stay application for waiver of pre-deposit and stay of recovery of Rs. 1,71,370/- with interest and penalty imposed on the applicant.- Confirmation of demand by Deputy Commissioner based on wrongly taken Cenvat credit on outward courier charges, rent-a-cab services, tour and travel services, and architectural consultancy service charges.- Interpretation of eligibility for Cenvat credit on outward courier charges, rent-a-cab services, tour and travel services, and architectural consultancy services for guest houses and conference halls.Analysis:The judgment pertains to a stay application filed by the applicant seeking waiver of pre-deposit and stay of recovery of Rs. 1,71,370/- with interest and equal penalty. The demand was confirmed by the Deputy Commissioner based on the applicant wrongly taking Cenvat credit on outward courier charges, rent-a-cab services, tour and travel services, and architectural consultancy service charges related to guest houses and conference halls.The applicant's counsel argued that outward courier charges were eligible for Cenvat credit as per a decision by CESTAT, Ahmedabad Bench, which recognized courier services as input services. Similarly, rent-a-cab services and tour and travel services were deemed eligible for Cenvat credit based on a ruling by the Hon'ble Karnataka High Court. The counsel contended that architectural consultancy services for guest houses and conference halls were also essential for manufacturing final products.The Deputy Commissioner, representing the Revenue, supported the lower authorities' findings. However, after considering both sides, the Member (T) found merit in the applicant's case regarding outward courier services, rent-a-cab services, and tour and travel services, citing precedents from the Tribunal and High Court. However, the architectural consultancy service for guest houses and conference halls was deemed prima facie unrelated to the manufacturing process. Consequently, the Member (T) ordered a pre-deposit of Rs. 20,000/- to be paid by the applicant within six weeks, with a stay of recovery for the balance amount until the appeal's disposal.In conclusion, the judgment addressed the eligibility of Cenvat credit on specific services and highlighted the importance of legal precedents in determining such eligibility. The decision balanced the applicant's arguments with established legal interpretations to arrive at a reasoned conclusion regarding the pre-deposit and stay of recovery in the case.
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