2016 (6) TMI 615 - AT - Central Excise

Cenvat credit on services received - non payment of duty - though the entire Service Tax was recovered from the appellant by the service provider M/s Radha Enterprises but the same was not deposited with the department - Held that - Appellant took cenvat credit on the basis of cenvatable documents received from M/s Radha Enterprises, Durgapur. No evidence could be produced by the Revenue that at the time of taking credit appellant was aware of non tax payment status. It is also observed from the case records that appellant has relied upon the following case laws that for nonpayment of service tax action can be taken against the service provider & not against the assessee who takes Cenvat Credit like Vikas Pipes Vs. CCE Chandigarh 2003 (10) TMI 59 - PUNJAB AND HARYANA HIGH COURT In view of the above cenvat Credit was rightly taken by the appellant.

Summary

Issues: Appeal against OIA passed by Commissioner (Appeals) Ranchi regarding admissibility of Cenvat Credit based on invoices from M/s Radha Enterprises.

Analysis:
1. Non-appearance of Appellant: The appellant failed to appear for multiple scheduled hearings, leading to delays in the proceedings. The case was repeatedly adjourned due to the appellant's absence, causing disruptions in the legal process.

2. Cenvat Credit Admissibility: The appellant claimed Cenvat Credit based on invoices from M/s Radha Enterprises. The Revenue argued that since M/s Radha Enterprises did not pay duty on the inputs, the appellant was not eligible for the credit under the CENVAT Credit Rules 2004. However, the Revenue could not provide evidence that the appellant was aware of the non-payment status at the time of claiming the credit.

3. Legal Precedents: The appellant relied on legal precedents, citing cases such as Vikas Pipes Vs. CCE Chandigarh and CCE Vs. Mahajan Steel Tubes, which established that action for nonpayment of service tax should be taken against the service provider, not the assessee claiming Cenvat Credit. The Tribunal noted these precedents and found that the appellant had rightfully taken the credit.

4. Decision: After hearing the arguments and examining the case records, the Tribunal concluded that the appellant had validly taken the Cenvat Credit. The appeal was allowed, and the Order in Appeal dated 17/4/2012 passed by the first appellate authority was set aside. The operative part of the order was pronounced in the open court, finalizing the decision in favor of the appellant.

This detailed analysis of the judgment highlights the procedural aspects, arguments presented by both parties, reliance on legal precedents, and the ultimate decision reached by the Tribunal regarding the admissibility of Cenvat Credit in the case.