2015 (8) TMI 1345 - AT - Central Excise

CENVAT credit - manufacture of paints - credit of service tax paid by Head Office on input services - whether the denial of the cenvat credit to the appellant on the ground that the input services were received by the head office prior to obtaining registration certificate from the jurisdictional service tax authorities, justified? - Held that - I find from the available records that head office of the appellant in Delhi was registered with the Service Tax Authorities on 06.03.2006 and thereafter on 16.03.2006, the ISD invoices were issued to the appellant, enabling it to take cenvat credit of service tax paid on the disputed services. Since the appellant has taken the cenvat credit based on the document prescribed under Rule 9 of the Cenvat Credit Rules, I am of the considered view that there is no infirmity in taking such cenvat credit, and as such, the same cannot be denied to the appellant - appeal allowed - credit allowed - decided in favor of assessee.

Summary

Issues: Denial of cenvat credit to appellant due to input services received by head office prior to registration certificate issuance.

In this case, the appellant, engaged in manufacturing paints, availed cenvat credit of service tax paid by the head office on input services. The service tax department denied the credit, stating the input services were received before obtaining the registration certificate. The appellant argued that since the ISD invoices were issued after registration, credit should not be denied as per the Cenvat Credit Rules, 2004. The appellant also highlighted that the credit distribution was duly reflected in returns filed with the Central Excise Authorities in Delhi. On the other hand, the respondent contended that credit distribution was not in line with the cenvat statute as services were received before registration. The respondent cited previous tribunal decisions to support their stance. After considering the arguments, the tribunal found that the appellant's registration was in place before ISD invoices were issued, allowing for cenvat credit as per Rule 9 of the Cenvat Credit Rules. The tribunal distinguished the cited cases as not applicable to the current scenario. Consequently, the impugned order denying cenvat credit was set aside, and the appeal was allowed in favor of the appellant.