2016 (12) TMI 1729 - AT - Service Tax

CENVAT Credit - input services - shifting of establishment - case of Revenue is that just because the input services were availed in the previous premises before March 2013, authorities below should not have disallowed the services availed without considering the use of input service in both the premises - Held that - It is clear that even though invoices were in the name of the old premises, input services were availed and utilised at both the new and old premises during the transition period from January to March 2013. Ultimately, entire activity was carried out from new premises in March 2013. The use of input service to provide taxable output service being fulfilled without being contradicted by Revenue, the stationary showing the address of the previous premises shall not debar the appellant to Cenvat credit of service tax paid on the input services used - appeal allowed.

Summary

Issues:
1. Disallowance of input services availed by the Appellant before March 2013.
2. Utilization of input services in both old and new premises during transition.
3. Eligibility of Cenvat credit on service tax paid on input services used.

Analysis:
1. The Appellant contended that it provided Information Technology and Business Support Services from its previous premises before shifting to a new establishment in March 2013. The Appellant argued that since services were availed in both premises during the transition period from January to March 2013, disallowing the services availed before March 2013 without considering their use in both locations was unjustified.

2. The Revenue, however, opposed the Appellant's claim. After hearing both sides and examining the records, it was noted that although the invoices were in the name of the old premises, input services were utilized at both the old and new locations during the transition period. The entire activity was eventually shifted to the new premises in March 2013. The Tribunal found that the use of input services to provide taxable output services was fulfilled without contradiction from the Revenue.

3. The Tribunal, upon reviewing the evidence on page-33 of the appeal folder, concluded that the Appellant was entitled to Cenvat credit on the service tax paid for the input services used. The Tribunal emphasized that the stationary showing the address of the previous premises should not prevent the Appellant from claiming the credit, as the input services were indeed utilized in both locations during the transition period, and the taxable output services were provided from the new premises in March 2013.

4. Consequently, the Tribunal allowed the appeal, ruling in favor of the Appellant based on the fulfillment of the conditions for claiming Cenvat credit on the service tax paid on the input services used. The decision was made after considering the utilization of services in both the old and new premises and ensuring that the requirements for availing the credit were met.

5. The judgment, delivered by Hon'ble Shri D.N. PANDA, Judicial Member, highlighted the importance of considering the actual use of input services in different locations during a transition period and upheld the Appellant's right to claim Cenvat credit based on the fulfillment of the necessary conditions, despite the address shown on the invoices.