Binding coordinate Bench rulings on CENVAT credit bar contrary Tribunal views on insurance facilitation services.

A coordinate Bench view on CENVAT credit for insurance-related facilitation services was treated as binding, because the service provider had discharged service tax and the provider-side assessment was not disturbed. The Tribunal could not deny credit by recharacterising the transaction or reopen the same issue through a contrary view. Judicial discipline required adherence to the settled line of decisions, and a Member (Technical) was not justified in independently departing from it. The contrary opinion was therefore unsustainable, and the challenged prejudicial portion of the Tribunal order was set aside.

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Issues: Whether the Member (Technical) could depart from the consistent view taken by coordinate Benches on the eligibility of CENVAT credit on service tax paid by automobile dealers for insurance-related facilitation services, and whether the prejudicial portion of the split order could be sustained.

Analysis: The dispute centred on CENVAT credit claimed by the insurance company on invoices raised by automobile dealers for services connected with procuring insurance business. Coordinate Benches had repeatedly held that where the service provider has discharged service tax and the assessment at the provider's end has not been disturbed, credit at the recipient's end cannot be denied merely by recharacterising the transaction. The Court held that those earlier decisions were binding on the Tribunal and that judicial discipline required adherence to the settled view. It found that the Member (Technical) was not justified in independently reappreciating the same issue and taking a contrary view, and that the reference to a third Member on a settled question was unnecessary.

Conclusion: The contrary opinion of the Member (Technical) could not be sustained, and the assessee was entitled to succeed on the question of CENVAT credit and the maintainability of the challenged portion of the Tribunal's order.

Final Conclusion: The impugned prejudicial portion of the Tribunal's order was set aside, and the writ petitions were allowed in full.

Ratio Decidendi: A coordinate Bench decision on an identical tax issue is binding on the Tribunal, and judicial discipline forbids a member from taking a contrary view or re-adjudicating the same matter unless the issue is referred in the manner recognised by law.

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