2015 (5) TMI 210 - AT - Service Tax

Disallowance of CENVAT Credit - Invoices in the name of other company wrongly - later corrected on the basis of letter - Held that - Six invoices on which the appellant claimed CENVAT credit are in the name of M/s. Hemraj Cable Network. However, the appellant claimed that the name was wrongly mentioned by the service-provider whereas, the invoices were meant for the appellant only. On a careful perusal of all the documents submitted by the appellant, I find that though the name in the invoices was mentioned as Hemraj Cable Network but the same stand corrected on the basis of letter by distributor of M/s. Zee-Turner Ltd., who certified that this mistake is due to feeding error in the computer. This clearly shows that the invoices were issued to M/s. Shivraj Cable Network only and not for anyone else. On a scrutiny of the records such as invoices, account ledger, bank statement, etc. it is clearly found that for all these six invoices the payment was made by the appellant i.e., M/s. Shivraj Cable Network to the service-provider M/s. Zee-Turner Ltd. through banking channel. If any of the particulars required is not mentioned in the document and the Dy. Commissioner of the Assistant Commissioner, as the case may be, is satisfied that the goods or services covered by such documents have been received and accounted for in the books of account of the receiver, CENVAT credit can be allowed. It is found in the present case, that except name of the appellant, on the basis of all the documents submitted by the appellant, it is established that the services were received by the appellant and the same has been accounted for in their books and the payment for the said services were made by the appellant to the service-provider i.e., M/s. Zee-Turner Ltd. - appellant is legally entitled for the CENVAT credit on all the subject six invoices - Decided in favour of assessee.

Summary

Issues:
- Disallowance of CENVAT credit on input service bills due to typographical error in the recipient's name.
- Appellant's contention of receiving services and making payments despite the error.
- Interpretation of Rule 9(2) of CENVAT Credit Rules 2004 regarding allowance of credit.

Analysis:

1. The appeal challenged the rejection of CENVAT credit by the Commissioner of Central Excise (Appeals)-II, Mumbai, based on the disallowance of credit and penalties imposed by the adjudicating authority on M/s. Shivraj Cable Network for availing credit on input service bills issued in the name of M/s. Hemraj Cable Network.

2. The appellant contended that the error in the recipient's name on the bills was a typographical mistake by the service provider, M/s. Zee Turner Ltd., and provided evidence to support their claim. They submitted documents, including a letter requesting correction, distributor certification, invoices, bank statements, ledger copies, and an affidavit by the appellant-firm's partner confirming receipt of services and payment made.

3. The appellant relied on legal precedents and Rule 9(2) of CENVAT Credit Rules 2004 to argue that despite the name error, since the services were received and accounted for by the appellant, CENVAT credit should not have been denied. The rule allows credit if goods or services covered in the documents have been received and accounted for in the receiver's books, even if all particulars are not mentioned.

4. The Revenue, represented by the Assistant Commissioner, maintained the findings of the impugned order disallowing the credit based on the recipient name discrepancy.

5. Upon reviewing all submissions, the Member (Judicial) found that the invoices were indeed meant for M/s. Shivraj Cable Network despite the name error, as evidenced by distributor certification, payment records, and other documents. The correct customer code was consistently mentioned, and the partner's affidavit further confirmed the transactions.

6. Referring to the proviso of Rule 9(2) of CENVAT Credit Rules, the Member concluded that since all necessary particulars were present except the recipient's name, and the services were received, accounted for, and paid for by the appellant, the appellant was legally entitled to the CENVAT credit on the disputed invoices.

7. Consequently, the impugned order was set aside, and the appeal was allowed in favor of M/s. Shivraj Cable Network, establishing their entitlement to the CENVAT credit on the input service bills despite the typographical error in the recipient's name.