2018 (4) TMI 55 - AT - Central Excise

CENVAT credit - duty paying documents - whether the appellant have availed Canvat credit of input service in the nature of banking and other services on the basis of improper invoice, not issued in accordance with rule 9 of CCR, 2004 read with Rule 4A of S.T.R. 1994? - Held that - no specific Performa of the invoice have been notified or prescribed under Rule 4A(2) of S.T.R. but the requirement of the said Rule is that the invoice should contained the details as mentioned therein - Cenvat credit cannot be denied on technical grounds. There is no objection at the end of ISD, and the ISD is also registered under the Service Tax and filing returns - credit availed is proper - penalty also set aside - appeal allowed.

Issues involved:
1. Availment of Cenvat credit for input services in the nature of banking and financial services based on improper invoices.
2. Denial of Cenvat credit by the Deputy Commissioner and subsequent appeal before the Commissioner (Appeals).
3. Consideration of Cenvat credit entries and penalty reduction under Rule 15(2) of CCR, 2004.
4. Discrepancies in the invoices and the subsequent allowance of Cenvat credit by the Commissioner (Appeals).
5. Final decision by the Tribunal on the appeal and consequential benefits for the appellant.

Analysis:

1. The primary issue in this case revolves around the appellant's availing of Cenvat credit for input services, particularly banking and financial services, based on invoices that were allegedly not issued in compliance with the relevant rules. The dispute arose from a show cause notice alleging improper documentation as per rule 9 of CCR read with rule 4A of S.T.R. 1994.

2. The appellant, engaged in manufacturing bitumen Emulsion & Modified Emulsion, faced a demand for the denial of Cenvat credit related to banking and financial services, among others. The Deputy Commissioner confirmed the proposed demand of ?4,64,509 along with an equal penalty, leading to an appeal before the Commissioner (Appeals).

3. The Commissioner (Appeals) partially allowed the appeal, permitting a balance Cenvat credit of ?1,63,734 for one entry and confirming ?3,00,775 for another entry. The penalty under Rule 15(2) of CCR, 2004 was reduced to ?1 lakh. Dissatisfied with the decision, the appellant approached the Tribunal for further redressal.

4. During the proceedings, it was highlighted that the Revenue had previously considered the same entry in a subsequent show cause notice, ultimately allowing the credit fully. The Commissioner (Appeals) in that case emphasized the importance of invoice details and observed that Cenvat credit should not be denied on technical grounds. This previous decision played a crucial role in the appellant's favor.

5. Considering the findings of the Commissioner (Appeals) in the previous case and the absence of further disputes, the Tribunal allowed the appeal in favor of the appellant. The impugned order denying Cenvat credit was set aside, and the penalty imposed was deleted. The appellant was entitled to consequential benefits as per the law.

This comprehensive analysis outlines the progression of the case from the initial denial of Cenvat credit to the final decision by the Tribunal, emphasizing the importance of proper documentation and adherence to rules in availing credits while also showcasing the significance of precedent in legal proceedings.

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