2016 (12) TMI 1065 - AT - Service Tax

Availment of credit prior to registration of the unit - construction of ICD - denial of credit on the ground that neither their head office nor Pithampur ICD was registered during the period when the construction service was received and bills received - Held that - the issue stands decided in the case of Doshion Ltd. vs. CCE, Ahmedabad 2012 (10) TMI 952 - CESTAT AHMEDABAD , where it was held that registration with the department is not a pre-requisite for claiming the credit - appeal allowed - decided in favor of appellant-assessee.

Summary

Issues:
Availment of Cenvat Credit prior to registration of the unit.

Analysis:
The case involved a dispute regarding the eligibility of the appellants to claim Cenvat Credit on service received prior to their registration. The appellants, engaged in providing logistic services, constructed an Internal Container Depot (ICD) and took registration after the completion of construction. The Revenue contended that since the registration was obtained after the construction period, the appellants were not entitled to Cenvat Credit on services received before registration. The appellants argued that they could not have applied for registration during the construction phase when no services were being provided from the ICD. They clarified that the credit was taken for the first time post-registration at the ICD, and there was no time limit for claiming credit based on the service provider's invoice.

The Revenue suggested that the case involved the distribution of input service credit, emphasizing that the Mumbai office should have registered as an input service distributor and passed on the credit to the ICD. However, the tribunal disagreed, stating that the entire credit for the ICD construction activity was taken at the ICD itself, and it was not feasible to claim credit before commencing operations.

The tribunal referred to various decisions, including Doshion Ltd. vs. CCE, Dorling Kindersley (I) Pvt. Ltd. vs. CCE, CST, Bangalore vs. Kyocera Wireless (I) Pvt. Ltd. vs. CCE & ST, and mPortal India Wireless Solutions P Ltd. vs. CST Bangalore. These decisions collectively established that registration with the department was not a prerequisite for claiming credit. Consequently, the tribunal ruled in favor of the appellants, setting aside the impugned order and allowing the appeal with consequential relief.