2018 (5) TMI 29 - AT - Service Tax

CENVAT credit of service tax paid by other unit - the appellant did not have centralised Registration nor permission from the Dept - whether the appellant Bhachau Steel unit is entitled to Cenvat Credit of Service Tax paid on GTA service by their Khambhalia unit? - Held that - the issue is covered by the judgment of the Hon ble Gujarat High Court in the case of CCE vs Daishon Ltd 2016 (2) TMI 183 - GUJARAT HIGH COURT , where it was held that when it was found that full records were maintained and the irregularity, if at all, was procedural and when it was further found that the records were available for the Revenue to verify the correctness, the Tribunal, in our opinion, rightly did not disentitle the assessee from the entire Cenvat credit availed for payment of duty - credit allowed - appeal allowed - decided in favor of appellant.

Summary

Issues Involved:
- Entitlement to Cenvat Credit of Service Tax paid on GTA service by one unit for another unit without centralized registration or permission from the Department.

Analysis:
The appeal was filed against the order passed by the Commissioner of Central Excise, Customs, and Service Tax (Appeals) - RAJKOT, regarding the entitlement of the appellant's Steel unit to Cenvat Credit of Service Tax paid on GTA service by their other unit. The main contention was that due to the lack of centralized registration or permission from the Department, the appellant might not be eligible to avail such credit. The issue revolved around the interpretation of the Rules of 2005 for registration of input service distributors and whether the absence of such registration automatically disentitles an entity from availing Cenvat credit. The judgment referred to a case where the Tribunal viewed the requirement as curable, especially when full records were maintained, and any irregularity was deemed procedural. The Tribunal's decision in the appellant's own case was also cited, where the appeal was allowed.

The judgment highlighted the importance of maintaining full records and the availability of such records for the Revenue to verify correctness. It emphasized that procedural irregularities should not automatically disentitle an entity from availing Cenvat credit, especially when the irregularity is curable. The Tribunal's decision in the appellant's case, along with the reference to the judgment of the Hon'ble Gujarat High Court, supported the view that the absence of centralized registration should not bar an entity from availing Cenvat credit if all other requirements are met. Ultimately, the impugned order was set aside, and the appeal was allowed with consequential relief, if any, as per the law.