CENVAT credit on input-related services justified interim waiver of pre-deposit and stay of recovery pending appeal

Disputed CENVAT credit on services such as architect, interior designer, construction, mandap and catering, photography, pandal and shamiana, club or association, interior decorators and works contract services was found to be prima facie supported by existing precedent treating such services as input service under Rule 2(l) of the CENVAT Credit Rules, 2004, together with invoices and other records. On that basis, a fairly good case for interim protection was made out, so pre-deposit was waived and recovery of the adjudicated credit, interest and penalty was stayed pending appeal.

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Issues: Whether the appellants made out a prima facie case for waiver of pre-deposit and stay of recovery of the adjudicated demand of CENVAT credit, interest and penalty on the disputed services.

Analysis: The disputed credits related to services such as architect and interior designer services, construction service, mandap and catering service, photography service, pandal and shamiana service, club or association service, interior decorators service and works contract service. The Tribunal noted that, save for small amounts, the credits were supported by decisions treating such services as falling within the scope of input service under Rule 2(l) of the CENVAT Credit Rules, 2004, and that the appellants had placed supporting invoices and judicial precedents. On that basis, the Tribunal found that the appellants had established a fairly good case for interim relief.

Conclusion: Waiver of pre-deposit was granted and recovery of the adjudicated liabilities was stayed during the pendency of the appeals.

Ratio Decidendi: Where the disputed CENVAT credit on input-related services is prima facie covered by existing precedent and supporting records, pre-deposit may be waived and recovery stayed pending appeal.

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