2021 (11) TMI 1086 - AT - Service Tax

Recovery of CENVAT Credit along with interest and proposing equivalent penalty - Cenvat credit availed on input services on the strength of documents issued by their head office namely Dabur India Ltd. (Corporate Office), Ghaziabad, were registered with the Department as distributor of credit - Revenue observed that these documents did not have the requisite information such as name, address and registration number of the service provider, serial number and date of invoice/bills/challans etc. as required under Rule 4A of the Service Tax Rules, 1994 - HELD THAT - The verification has been done. Name and address, PAN based registration of the suppliers along with verification report dated 10-10-2011 have been provided by the appellant. In fact, the verification was required to be done with the registration number provided by the appellant in 2019 to find out whether these suppliers were having the registration number as mentioned in the invoices provided by the appellant or not? If the registration number provided earlier is matched with PAN based registration provided by the appellant at present, then, the appellant is entitled for Cenvat credit - Therefore, the matter is remanded back to the adjudicating authority to verify as directed by this Tribunal hereinabove and thereafter to pass an appropriate order in accordance with law. The appeal is disposed of by way of remand.

Summary

Issues:
1. Availment of Cenvat credit on input services without requisite information.
2. Disallowance of Cenvat credit, interest, and penalty by the Commissioner.
3. Verification of registration numbers for suppliers for Cenvat credit eligibility.
4. Remand for further verification and appropriate order.

Analysis:
The case involved the appellant, engaged in the manufacture of Ayurvedic Medicaments, availing Cenvat credit on input services based on documents issued by their head office. The Department, upon audit, found discrepancies in the documents as they lacked essential information required under Rule 4A of the Service Tax Rules, 1994. Additionally, the documents did not specify if the distributed credit pertained to units paying duty or exempted units. Consequently, a show cause notice was issued for recovery of Cenvat credit, interest, and penalty. The Commissioner disallowed a portion of the credit, imposed a penalty, and did not address the second issue raised in the notice. The appellant appealed to the Tribunal, which remanded the matter for verification.

During the remand proceedings, verification was conducted based on the PAN-based registration number provided by the appellant in 2019. The Tribunal noted that the verification needed to match the registration numbers to determine the appellant's entitlement to Cenvat credit. As the verification was not done with the registration number provided in 2019, the matter was remanded back to the adjudicating authority for proper verification and a lawful decision.

After hearing both parties and reviewing the affidavits, the Tribunal found that the verification had been completed, and the necessary information was provided by the appellant. The Tribunal directed the adjudicating authority to verify if the registration numbers matched with the PAN-based registrations to ascertain the appellant's eligibility for Cenvat credit. Consequently, the appeal was disposed of by way of remand, instructing the authority to pass an appropriate order after the verification in accordance with the law.

In conclusion, the Tribunal's decision focused on the verification of registration numbers to determine the appellant's eligibility for Cenvat credit, emphasizing the need for compliance with the rules and regulations governing the availing of such credits. The case highlighted the importance of providing accurate and complete documentation to support claims for Cenvat credit to avoid disallowances and penalties.