2014 (8) TMI 17 - AT - Central Excise

Tribunal grants appeals, stresses procedural compliance for CENVAT Credit benefits.

The Tribunal allowed the appeals, remanding the case to the first appellate authority for further consideration upon compliance with the directed deposit. ... Waiver of pre-deposit - Cenvat credit - input services - selling commission for issue of IPO, Under Writing Commission of IPO, and Brokerage Incentive for IPO - commissioenr (appeals) dismissed the appeals for non-compliance of order of 50% deposit - prima facie case - Held that:- In view of the order passed by this Bench in the case of Aditya Birla Nuvo Ltd (2009 (1) TMI 117 - CESTAT AHMEDABAD) relied upon by the appellant, CENVAT Credit with respect to IPO related services has been held to be admissible. So far as not following of procedure of ISD registration, appellant has relied upon the case laws that substantial benefit cannot be denied on the basis of procedural deficiencies which can be rectified. In view of the case records and the arguments taken by the appellant, there is an arguable case for the appellant regarding admissibility of CENVAT Credit on the services involved. It is, therefore, felt that the pre-deposit amount asked for by the first appellate authority was on the higher side. - Appellant directed to deposit an amount of ₹ 50,000 /- - appeals restored before first appellate authority. Issues involved: Stay applications and appeals against separate Orders-in-Appeal on admissibility of CENVAT Credit for various services, including IPO related services and procedural deficiencies in ISD registration.Analysis:1. The appellant argued that the first appellate authority dismissed their appeals for non-compliance and ordered a high pre-deposit amount. They contended that CENVAT Credit for selling commission, underwriting commission, and brokerage incentive for IPO services is admissible based on a previous judgment. The appellant's advocate cited relevant case laws to support their argument that substantial benefit of CENVAT Credit cannot be denied due to procedural deficiencies.2. On the other hand, the Revenue argued that the appellant had taken credit for the same amount in another factory and that the credit taken at the factory under construction was reversed by the Department. The Revenue supported the higher pre-deposit amount requested by the first appellate authority.3. After considering the arguments and case records, the Tribunal found that there is an arguable case for the appellant regarding the admissibility of CENVAT Credit on the services in question. The Tribunal noted that the pre-deposit amount requested was on the higher side and directed the appellant to deposit a specified amount within a set timeframe. Once the deposit is made, the first appellate authority is instructed to decide the appeals on merit.4. Ultimately, the Tribunal allowed the appeals by way of remand to the first appellate authority for further consideration based on the compliance with the directed deposit. The judgment emphasizes the importance of adhering to procedural requirements while also ensuring that the substantive benefits of CENVAT Credit are not arbitrarily denied.