2017 (6) TMI 676 - AT - Central Excise

CENVAT credit - duty paying invoices - denial of credit on the ground that appellant has received credit on the strength of debit not which is not the proper documents for availment of CENVAT credit - Held that - CENVAT credit cannot be denied to the appellant on the ground that debit note is not an admissible document for availment of CENVAT credit - In fact, the documents contain the details of service providers namely, name, address, registration number, nature of service, amount of service provided and service tax paid. These particulars are not disputed by the Revenue and therefore, CENVAT credit cannot be denied to the appellant - credit allowed - appeal allowed - decided in favor of appellant-assessee.

Summary

Issues:
1. Denial of Cenvat credit based on debit notes instead of invoices.
2. Denial of Cenvat credit on services provided to sister unit.
3. Appeal against the impugned order regarding availment of Cenvat credit on specific services.

Analysis:
1. The appellant's Cenvat credit was denied due to taking credit based on debit notes instead of proper invoices. The appellant contested this denial, arguing that the documents contained necessary details like service provider information, service nature, and tax paid. The tribunal held that since these particulars were undisputed by the Revenue, Cenvat credit could not be denied based solely on the form of the document. Citing the case of Ultratech Cement Limited, the tribunal ruled in favor of the appellant, allowing the Cenvat credit availed on the strength of debit notes.

2. Cenvat credit on services like Tour Operators, Management & Maintenance or Repair Service, Architect Service, and Training Service was contested on the grounds that the appellant provided these services to their sister unit without reversing the proportionate amount. The Commissioner partially allowed the credit but disallowed a portion pertaining to the sister unit. The tribunal, after hearing both parties and reviewing the records, found that the appellant was entitled to Cenvat credit for services used in their manufacturing business, including those provided to the sister unit. The tribunal noted that the appellant paid service tax on the rent received from the sister unit, making them eligible for Cenvat credit as input service for providing output service.

3. The Revenue filed an appeal against the appellant's availment of Cenvat credit on Outdoor Catering service, Tour Operator service, and renting of immovable property. The tribunal found that the Outdoor Catering service was used for manufacturing operations by the appellant and rightly allowed the Cenvat credit. Similarly, the Tour Operator service was deemed essential for business activities related to manufacturing, justifying the appellant's entitlement to Cenvat credit. Regarding the renting of immovable property, although part of the premises was leased to the sister unit, the appellant paid service tax on both rent paid and received, making them eligible for Cenvat credit. The tribunal modified the impugned order, allowing the appellant's appeal and dismissing the Revenue's appeal.

This comprehensive analysis of the judgment highlights the key issues addressed by the tribunal and the reasoning behind their decisions, ensuring a detailed understanding of the legal aspects involved.