2015 (10) TMI 1564 - AT - Central Excise

Availment of CENVAT Credit - input services - nexus with manufacture - Suppression of facts - Inadmissible documents - erection, installation and commissioning services - Held that - Appellants have paid excise duty on the same price on the invoice price of the conductors which includes the installation charges. Accordingly, the said services of installation, erection and commissioning provided by a third party have been utilised by the appellant in the course of its business of manufacture and sale. Accordingly, I find that the said services have been utilised in the course of manufacturing and accordingly, the Cenvat credit is allowable. The appellant also points out that out of total amount of ₹ 3,29,697/- in respect of erection and commissioning and installation services of ₹ 86,808/- on account of credit on service tax paid by sub-contractor wherein the appellant have undertaken sub-contract for erection and commissioning. The appellant also paid service tax on the provision of said services and as such the input service credit taken of ₹ 86,808/- is allowable which is paid by the sub-contractor. I hold that the said credit of ₹ 86,808/- also allowable. It is also held that the services in respect of clearance of the final product from the place of removal. Under the circumstances, if the premises of the buyers as the appellant had taken both selling of the products as well as the installation which is included in the selling price. So far as the credit taken on the telephone service is concerned, it is an admitted fact that the said telephone connections although justifying that it occupies in the factory premises, in the admitted that during the period under consideration, the appellant is on the occupation of the premises in the case manufacturing activities and they have utilising the telephone credit I also find that the appellant paid most of the bills for the telephone through account pay cheques and the payments are reflected in the bank statements. Under the circumstances, I hold that the Cenvat credit is allowed. As regard denial on the ground of inadmissible documents appellant have not brought any additional records even at the first appellate stage before this tribunal in support of the allowability of the credit disallowed. As such, I uphold the allowance of input credit on account of defective documents. - Decided partly in favour of assessee.

Summary

Issues:
1. Admissibility of Cenvat credit on various input services.
2. Disallowance of credit on the basis of inadmissible documents.

Analysis:

Issue 1: Admissibility of Cenvat credit on various input services:

The appellant, a manufacturer, appealed against the Commissioner (Appeals) order regarding the admissibility of Cenvat credit on inputs and input services. The show-cause notice alleged inadmissible credit on erection, installation, commissioning services, GTA, telephone services, and job work. The appellant contested the notice, citing rulings and justifications. The Tribunal analyzed the case law and found in favor of the appellant. It held that the services were utilized in the course of manufacturing, making the Cenvat credit allowable. The Tribunal also allowed credit on service tax paid by a sub-contractor for erection and commissioning. The ruling emphasized that the services were used in the manufacturing process, justifying the credit. The Tribunal differentiated between pre and post-2008 rules regarding outward transportation credit, ultimately allowing the credit based on judicial precedents.

Issue 2: Disallowance of credit on the basis of inadmissible documents:

Regarding the disallowance of credit on account of inadmissible documents, the appellant argued that they had submitted necessary details with their returns. The appellant claimed that the limitation for extended period should not apply as they had provided supporting documents. The Tribunal noted the lack of additional records to support the allowance of disallowed credit. Ultimately, the Tribunal upheld the disallowance of input credit due to defective documents, stating that the appellant failed to provide sufficient evidence to justify the credit.

In conclusion, the Tribunal partially allowed the appeal, granting relief on certain grounds while upholding the disallowance of credit based on inadequate documentation.