Telangana High Court
The Principal Commissioner Of Gst And ... vs M/S. Union Bank Of India on 27 June, 2024
THE HONOURABLE SRI JUSTICE SUJOY PAUL
AND
THE HONOURABLE SRI JUSTICE NAMAVARAPU RAJESHWAR RAO
CEA.No.8 of 2024
JUDGMENT (per Hon'ble SP,J)
Sri A. Rama Krishna Reddy, learned Standing Counsel for CBEC for the appellant is heard on admission.
2. Learned Standing Counsel for the appellant raised certain substantial questions of law and contended that the Tribunal has erred in deciding it in favour of the assessee.
3. We have heard him at length.
4. The paragraph No.6 of impugned order of the Tribunal reads as under:
"Heard the parties. We find that the issue is no longer res-integra and the same have been adjudicated by the Hon'ble Kerala High Court in C.E.Appeal No.1 of 2021 along with other appeals and vide judgment dated
05.12.2022 the High Court relying on the ruling of Larger Bench of this Tribunal in South Indian Bank being Final Order No.20691-30708/2020, dated 23.09.2020, habe held that similarly situated assessee like banks are entitled to take Cenvat Credit on the premium paid to DICGC for the insurance services rendered by DICGC to the banks. Hon'ble High Court observed that without accepting deposits the bank cannot extend loans which is necessary to earn profit and the banks are under statutory obligations to ensure the deposits received are issued for conducting the banking business. Further, the commercial banks face the risk of being dilicensed by the RBI if they did not insure the deposits with the DICGC (subsidiary of RBI)."
25. A plain reading of this order makes it clear that it is founded upon a decision of a Larger Bench of the Tribunal in the case of South Indian Bank (Final Order No.20691-30708/2020, dated 23.09.2020). The Said judgment of Larger Bench was called in question before the Kerala High Court in C.E.Appeal No.1 of 2021, which was decided on 05.12.2022. Speaking for the Division Bench, Hon'ble Sri Justice S.V.Bhatti (as his Lordship then was) opined as under:
"The payment of premium on insurance together with service tax for valid and correct reasons has been held by the Larger Bench as follows:
"The insurance service provided by the Deposit Insurance Corporation to the banks is an "input service" and CENVAT Credit of service tax paid for this service received by the banks from the Deposit Insurance Corporation can be availed by the banks for rendering output services".
15. The substantial questions raised are not tenable, and the findings recorded by the larger bench have already considered these issues. Two questions argued before this Court are answered against the Revenue and in favour of the assessee. Hence C.E.Appeal No.1 of 2021 is dismissed.
For the view taken in the preceding paras, the questions raised in the appeals are answered against the revenue and in favour of the assessee. Hence the appeals stand dismissed."
6. No amount of argument could be advanced to persuade us to take a different view than the view taken by the Kerala High 3 Court. Thus, we find no reason to entertain this appeal. There exists no substantial question of law which necessitated this Court to admit the appeal.
7. The appeal is accordingly dismissed. No costs.
Interlocutory applications, if any pending, shall also stand closed.
_____________ Sujoy Paul, J _______________________________ Namavarapu Rajeshwar Rao, J 27th June, 2024 Myk/Tsr