M/s. IDFC Bank Limited @Hash Commissioner Of CGST, Mumbai East

This Appeal has been filed challenging the order dated 5.3.2018 passed by the Commissioner, CGST&C.EX., Thane Rural by which the learned

Commissioner rejected the Appeal filed by the Appellants while upholding the Order-in-Original dated 30.11.2016.

The issue involved is whether the Appellant is eligible to avail Cenvat credit of service tax paid by them on the deposit insurance service provided

by the Deposit Insurance and Credit Guarantee Corporation (DICGC)?

The Appellant is engaged in providing banking and various financial services in India. The department has denied the Cenvat Credit to the

Appellants on the ground that the service in issue do not qualify as “Input Service†in terms of Rule 2(l) of CCR and Cenvat credit for the service

tax paid by the Appellants for this service cannot be availed by them.

I have heard learned counsel for the Appellants and learned Authorised Representative for the Revenue and perused the case records including the

written submissions as well the decision by the larger Bench of the Tribunal in the matter of South Indian Bank vs. The Commissioner of Customs,

Central Excise & Service Tax-Calicut; 2020-TIOL-861-CESTAT-BANG-LB placed on record by the learned counsel for the Appellants. In the

aforesaid decision of the Larger Bench of the Tribunal it has been held that insurance service provided by the DICGC to the Banks for insuring the

deposits of the public with the Banks is an “Input Service†in terms of Rule 2(l) of CCR and Cenvat credit for the service tax paid by the banks

for this service can be availed by the banks for rendering output service. In view of the decision of the Larger Bench of the Tribunal in the matter of

South Indian Bank (supra), I am of the considered opinion that the issue involved in the instant Appeal is no longer res integra. The aforesaid decision

of the Larger Bench was also considered by the Hon’ble High Court of Judicature at Bombay in the matter of Bank of Maharashtra vs.

Commissioner, CGST&&CX, Pune-II etc.etc.; 2020- VIL-479-BOM-ST and while relying upon the decision of the Larger Bench of the Tribunal, the

Hon’ble High Court allowed the Appeals filed by various Banks before the Hon’ble High Court on the aforementioned issue and remanded

the appeals back to the Tribunal for fresh decision in conformity with the decision rendered by the larger bench.

Therefore in view of the decision of the Larger Bench of the Tribunal in the matter of South Indian Bank (supra) the instant Appeal filed the

Appellant stands allowed.

(Order pronounced in the open Court on 06.01.2021)