Tribunal allows appeal on Cenvat credit transfer; Confirms Service Tax demand due to lack of documents.

The Tribunal allowed the appeal regarding the transfer of Cenvat credit from the appellant's 100% EOU to their servicing division, citing a previous ruling that there is no restriction on such transfers. The appellant was directed to receive consequential benefits. In the second issue, the Tribunal confirmed a Service Tax demand due to the appellant's failure to produce relevant documents during adjudication. The appellant agreed to deposit the amount with applicable interest, leading to the appeal being allowed in part with penalties set aside. The appellant was entitled to consequential benefits as per law.

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Issues:
1. Whether Cenvat credit earned by the appellant in their 100% EOU can be transferred to their servicing division in unbonded premises for discharging Service Tax liability.
2. Demand of Service Tax on Courier Service/GTA Service.

Analysis:
1. The appellant, engaged in various services and manufacturing activities, transferred Cenvat credit from their 100% EOU to their servicing division in unbonded premises for discharging Service Tax liability. The Audit Team noted this transfer and raised concerns about the admissibility of such credit transfer as per Cenvat Credit Rules, 2004. The Tribunal referred to a previous ruling in Elcomponics Sales Private Ltd case, where it was held that there is no restriction on utilizing Cenvat credit by a 100% EOU. The Tribunal allowed the appeal, citing the earlier ruling and stating that the transfer was revenue-neutral. The appellant was directed to receive consequential benefits as per law.

2. The second issue involved a demand for Service Tax amounting to &8377; 58,600 along with interest. The appellant claimed to have discharged the proper Service Tax during the relevant period but failed to produce relevant documents during adjudication in 2013. Consequently, the demand was confirmed due to lack of complete documents. The appellant, not contesting the amount, agreed to deposit the sum with applicable interest. The Tribunal disposed of this ground of appeal, directing the appellant to deposit the amount. Considering no contumacious conduct or suppression, all penalties imposed were set aside, and the appeal was allowed in part. The appellant was entitled to consequential benefits as per law.

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