2017 (6) TMI 749 - AT - Central Excise

CENVAT credit - duty paying invoices - whether the cenvat credits availed by the appellant in respect of service tax paid on goods transport services on the basis of TR-6 challans is valid? - Held that - the issue has come up before the Hon ble High Court of Bombay in the case of Essel Propack Ltd. 2015 (5) TMI 529 - BOMBAY HIGH COURT , where it was held that credit in respect of service tax paid on goods transport agency availed on the basis of TR-6 challans is valid for the prior period - credit allowed - appeal allowed - decided in favor of appellant.

Summary

Issues:
Validity of cenvat credits availed by the appellant in respect of service tax paid on goods transport services based on TR-6 challans prior to 16.06.2005.

Analysis:
The appellant, engaged in the manufacture of writing and printing paper, availed cenvat credits amounting to &8377;29,95,414/- during the period 01.02.2005 to 15.06.2005. The Department contended that credits availed on the basis of TR-6 challans before 16.06.2005 were inadmissible. The issue revolved around whether the credits were valid before the specified date of amendment. The appellant cited a Bombay High Court case supporting the validity of such credits for the prior period.

The Tribunal noted the High Court's decision in the Essel Propack Ltd. case, emphasizing the entitlement of recipients of goods transport agency services to take credit of the Service Tax paid on such services. The Tribunal highlighted that the Cenvat Credit Rules, 2004 did not specify documents for availing Service Tax credit during the disputed period. As TR-6 challans reflected payment of tax and the respondents were entitled to credit, the Tribunal upheld the validity of the credits availed by the appellant. The Tribunal also referenced a Punjab & Haryana High Court case supporting the entitlement to credit if duty payment was not disputed.

In conclusion, the Tribunal, following the High Court's decision, set aside the impugned order and allowed the appeal. The Tribunal emphasized that Rule 9, being a procedural aspect, could not deny the appellant's entitlement to the cenvat credit. The decision was based on the acceptance of TR-6 challans as proof of payment of Service Tax and the appellant's right to the credit they were entitled to.

This detailed analysis showcases the interpretation of the law, precedents cited, and the reasoning behind the decision to uphold the validity of the cenvat credits availed by the appellant for the disputed period.