2012 (6) TMI 726 - AT - Central Excise

CENVAT Credit - GTA Service - Suo moto availment - Held that - There is no dispute whatsoever on the amount of credit taken. In the instant case, the credit has been taken in pursuance to and in accordance with the order passed by the lower appellate authority vide order dated 12/11/2009. The said order has been upheld by this Tribunal also in the order dated 02/08/2011. That being the position, the appellant has rightly taken the credit. It is not a suo motu action on the part of the appellant but an action as directed by the lower appellate authority, which was reconfirmed by this Tribunal. Therefore, there is absolutely nothing wrong on the part of the appellant in availing the Cenvat credit - Decided in favour of assessee.

Summary

Issues:
- Availment of Cenvat credit on GTA services
- Allegation of taking credit suo motu
- Dispute regarding the denial of credit

Analysis:
- The appellant, M/s.Nitco Ltd., availed Cenvat credit on GTA services, but an investigation was initiated by the department in March 2006. The appellant reversed the credit in September 2006 and a show-cause notice was issued in November 2006. The credit was denied in November 2007, leading to an appeal by the appellant. The lower appellate authority allowed the credit in November 2009, which was availed by the appellant in their accounts in November 2009.

- The revenue challenged the lower appellate authority's order before the Tribunal, which dismissed the appeal in August 2011. However, the revenue issued a notice in December 2010 against the appellant for availing Cenvat credit, claiming there was no provision for availing credit suo motu. Subsequently, the credit was denied in February 2011 by the revenue, based on the order-in-appeal dated November 2009. The appellant appealed this denial, leading to the impugned order in February 2012, which again denied the credit.

- The main ground alleged by the revenue was that the appellant took credit suo motu. However, the Tribunal found that the credit was taken in accordance with the order passed by the lower appellate authority in November 2009, which was upheld by the Tribunal in August 2011. Therefore, the appellant had not taken the credit suo motu but as directed by the lower appellate authority and confirmed by the Tribunal. Consequently, the Tribunal set aside the impugned order and allowed the appeal with any consequential relief.

This judgment clarifies the issue of availment of Cenvat credit on GTA services, the allegation of taking credit suo motu, and the dispute regarding the denial of credit, ultimately ruling in favor of the appellant based on the direction given by the lower appellate authority and upheld by the Tribunal.