2023 (2) TMI 70 - AT - Service Tax

CENVAT Credit of service tax paid - Management or Business Consultancy Services - services were used for taxable as well as non-taxable/exempt services or not - power of jurisdictional Officers of the Appellants to question the correctness or change the classification of service adopted by the provider of such service - suppression of fact, willful mis-statement etc. - suppression of fact, willful mis-statement etc. - extended period of limitation - penalty - disputed issue pertains to interpretation of law.

HELD THAT:- In the present case the cenvat credit was denied in respect of service received by the appellant from M/s. Indian Hotels Co.Ltd. on the pretext that the same is classifiable under Business Auxiliary Service which is not specified under Rule 6(5) of Cenvat Credit Rules, 2004. The contention of the appellant is that the service provider M/s. Indian Hotels Co. Ltd. has provided the services under the head of Management or Business Consultancy Services, accordingly, the classification of service cannot be challenged at the service recipient end. Moreover, the classification of same service was challenged by the department and proceedings were initiated against M/s. Indian Hotel Co. Ltd., the matter was decided by this tribunal in PIEM HOTELS LTD. case [2016 (4) TMI 290 - CESTAT MUMBAI].

It can be seen that the same services provided by IHCL to M/s. Piem Hotels Ltd. was held classifiable under Management or Business Consultancy Services and not under Business Auxiliary Service accordingly, the Management or Business Consultancy Services clearly specified under Rule 6(5) of Cenvat Credit Rules, 2004 therefore, the appellant have correctly taken 100% credit in respect of such input service. As per this judgment, the entire foundation of the revenue’s case gets demolished therefore, the demand cannot be sustained on merit.

Appeal allowed.