2016 (5) TMI 309 - AT - Service Tax

Disallowance of Cenvat credit on rental services - Two different premises - there was old name of the assessee company in the invoice and also for address of Patna, Bihar - different premises having two different registration numbers and thus two different assessee - Held that - matter is remanded back to the adjudicating authority with a direction to verify the details and the fact of deposit of service tax by the service provider. The appellant is also directed to produce the clarification certificate from the service provider, clarifying clerical error in the invoices meant for rental premises mentioning their registration number etc and certifying that they have deposited the service tax. It is further held that the substantial benefit of Cenvat credit can not be denied for clerical error, which is evident on the face of record. - Decided in favour of appellant by way of remand

Summary

Issues:
1. Disallowance of Cenvat credit on rental services due to discrepancies in invoices and registration details.

Detailed Analysis:

The appellant, a service provider engaged in Business Auxiliary Services (BAS), appealed against an Order-in-Appeal dated 22/03/2013 passed by the Commissioner (Appeals), Central Excise & Customs & Service Tax, Noida. The appellant had taken Cenvat credit of ?2,42,738 based on invoices addressed to a different entity, leading to a show-cause notice for the period from April 2007 to December 2008. The appellant explained the historical evolution of their company, name changes, and shifting of registered offices, highlighting that they are essentially one entity despite changes in names and locations.

The Commissioner (Appeals) rejected the appeal, considering the registration as PAN-based and treating the appellant as two separate entities due to different PAN numbers and premises. The appellant contended that despite obtaining a new PAN number post relocation, they are the same entity, as evident from the amended service registration certificate issued in 2009. The appellant argued for the appeal's allowance based on the unity of the company under the Service Tax Act.

The revenue authority defended the disallowance of credit, citing errors and confusion caused by discrepancies in invoices and lack of clarity from the service provider. The issue of two PAN numbers and premises was not initially raised in the show-cause notice, leading to a remand for further verification. The Tribunal found the controversy regarding two separate entities no longer valid due to remarks on the amended registration certificate, indicating continuity with the old registration number.

The Tribunal remanded the matter to the adjudicating authority to verify details and ensure the deposit of service tax by the appellant. The appellant was instructed to provide a clarification certificate from the service provider, addressing clerical errors in invoices related to rental premises and confirming service tax payments. The Tribunal emphasized that Cenvat credit should not be denied due to clerical errors apparent on the record, allowing the appeal by way of remand for a reasoned order within 90 days.

In conclusion, the Tribunal directed the appellant to appear before the adjudicating authority with relevant documents and granted an opportunity for a hearing to resolve the Cenvat credit disallowance issue related to rental services.