2018 (5) TMI 92 - AT - Central Excise

CENVAT credit - input services - Internet and Telephone Services at various places - Held that - the issue is not very clear as to how the appellant is claiming the branch office at Vapi, Surat specifically addressed to the needs of the factory premises at Dadra and Bharuch - The First Appellate Authority has categorically recorded that the appellant did not produce any evidence to show the services were received in the respective units. The matter needs reconsideration by the Adjudicating Authority - appeal allowed by way of remand.

Summary

Issues:
1. Eligibility to avail cenvat credit of Service Tax paid on 'Internet and Telephone Services'.

Analysis:
The judgment by the Appellate Tribunal CESTAT AHMEDABAD involved two appeals challenging the orders passed by the Commissioner of Central Excise, Customs, and Service Tax (Appeals) - VAPI. The primary issue in question was the eligibility of the appellant to avail cenvat credit of the Service Tax paid on 'Internet and Telephone Services' at various places. The appellant's counsel argued that the input services were specific to different factory units, and thus, cenvat credit should not be denied only in respect of one unit. The counsel relied on previous tribunal decisions to support the appellant's case.

During the hearing, the appellant failed to provide concrete evidence demonstrating that the 'Internet and Telephone Services' at specific branches were directly related to the manufacturing units they were claiming credit for. The First Appellate Authority noted the lack of evidence supporting the appellant's claim, which was reiterated by the Tribunal. The Tribunal found it unclear how the appellant linked the branch offices to the factory premises and highlighted the absence of evidence showing that the services for which credit was claimed were specific to the units in question.

Considering the submissions and the lack of evidence, the Tribunal concluded that the issue required further examination by the Adjudicating Authority. The judgment set aside the impugned orders and remitted the matter back to the Adjudicating Authority for a fresh consideration, emphasizing the importance of following the principles of natural justice before reaching a conclusion. The appeals were disposed of by way of remand, leaving all issues open for reconsideration.

In summary, the judgment highlighted the crucial aspect of providing substantial evidence to support claims for cenvat credit eligibility, emphasizing the need for a clear connection between the input services and the specific units seeking credit. The decision underscored the importance of a thorough reconsideration of the issue by the Adjudicating Authority to ensure a fair and just determination based on the principles of natural justice.