AI Structured Summary
Not yet generated for this judgment
Judgment
Heard.
By this appeal, the appellant is challenging the order dated 24-4-2014 passed by the Customs, Excise & Service Tax Appellate Tribunal (CESTAT), New Delhi whereby learned Tribunal decided the application for waiver of pre-deposit and directed to deposit a sum of Rs. 3.00 crores towards Cenvat credit and CAM services, within a period of eight weeks from the date of order dated 24-4-2014 and to submit the compliance report on 8-7-2014.
Learned Counsel for the appellant has submitted that appellant is facing acute financial hardship, due to recession in the real estate market and he is not able to complete some of the projects in hand, due to financial constraints.
His next submission is that the availment of Cenvat credit by the Works Contractor has no bearance to the availability of Cenvat credit by the appellant. The ruling of Commr. of C. Ex., Visakhapatnam-II Vs. Sai Sahmita Storages (P) Ltd., (2011) 23 STR 341 : (2011) 45 VST 467 squarely covers the present matter and in identical circumstances, stay has been granted by the CESTAT, Mumbai in the case of Oberoi Mall Ltd. v. Commissioner of Service Tax-II, Mumbai on the ground that Excise duty paid on inputs and Service Tax paid on input services used in construction of immovable property can be taken and utilized for discharging Service Tax liability on renting of immovable property.
He also drew our attention to Para 7 of the impugned order and submitted that as per finding recorded by the CESTAT, appellant would be eligible for Cenvat credit in respect of inputs, capital goods and input services used in or in relation to providing the CAM services and the amount of CAM services comes to Rs. 2.90 crores whereas, the amount of Cenvat credit is Rs. 1.56 crores and the appellant is only entitled to pay the amount of Cenvat credit, which is Rs. 1.56 crores and as per order dated 7-1-2015 passed in CEA No. 22/2014, he is liable to deposit only 50% of the Cenvat credit amount and prays that the impugned order be partly set aside and appeal be allowed with a direction to the learned Tribunal to decide the appeal on merit at the earliest.
In reply, learned Counsel for the respondent has submitted that the issue whether the appellant would be liable for Cenvat credit of Excise duty paid on various inputs and Service Tax paid on various input services used by their contractors or in relation of construction of malls are the subject matter of the appeal and in other matter, which is identical and similar to the present appeal, this Court directed the appellant to deposit 50% of the amount in question within a period of 45 days from the date of receipt of certified copy of the order and, thus, the appeal be disposed of on the same terms. The order dated 7-1-2015 reads as under:-
"By this appeal, the appellant-assessee is challenging the order passed by the CESTAT whereby the CESTAT granted exemption regarding pre-deposit of the amount of Excise duty on payment of duty amounting to Rs. 21.00 lacs.
This interlocutory order has been challenged in this appeal.
Learned Counsel for the appellant has submitted that the learned CESTAT has erred in directing the appellant to deposit the amount without giving any reason or expressing any views on merits or demerits of the case. It has also been submitted that in identical circumstances, earlier the Tribunal in 2010 granted absolute stay and allowed the application for waiver of pre-deposit.
On the other hand, learned Counsel for the respondent-Department has submitted that in identical circumstances this Court in the case of Bharat Sanchar Nigam Limited v. Commissioner of Central Excise, Indore (CEA No. 35/2014, dated 10-11-2014) has directed the Bharat Sanchar Nigam Ltd., to deposit 50% of the amount in question.
On due consideration of the aforesaid, we are inclined to dispose of the appeal with a direction to the appellant to deposit 50% of the amount in question within a period of 45 days from the date of receipt of certified copy of this order. The CESTAT shall not dismiss the appellant''s appeal for non-compliance of the direction about the pre-deposit and shall decide the appeal on merits in accordance with law.
With the aforesaid, the substantial question of law framed by this Court is decided accordingly. Appeal stands partly allowed. No order as to costs."
On due consideration of the arguments of the learned Counsel for the parties, we are of the view that the question of grant of Cenvat credit and CAM services are the subject matter of the appeal and looking to the financial constraint and overall facts and circumstances of the case, no case for grant of total waiver or unconditional waiver, as prayed is made out. To safeguard the interest of the revenue as well as of the appellant, we direct the appellant to deposit 50% of the amount, within a period of 45 days from the date of order.
In the meanwhile, learned Tribunal shall not dismiss the appellants'' appeal for non-compliance of the direction about the pre-deposit and shall decide the appeal on merits, expeditiously, at the earliest, in accordance with law, only after receipt of deposit of the aforesaid amount. With the aforesaid, appeal is allowed in part and the impugned order is modified to the extent, as indicated hereinabove. No order as to costs.