2019 (10) TMI 413 - AT - Service Tax

CENVAT Credit - input services - Conference/Event Management Service - Maintenance Service for maintenance of D.G. Sets - Liasoning and Documentation Services - output services of telecommunication services - HELD THAT - As held by Hon ble Bombay High Court in THE COMMISSIONER OF SERVICE TAX VI, MUMBAI VERSUS M/S. DBOI GLOBAL SERVICES P. LTD. 2018 (12) TMI 171 - BOMBAY HIGH COURT the essential condition for admissibility of Cenvat credit on input service is whether the input service is used in providing output service. In the present case, there is no dispute that the above stated three input services were used in providing output service. There is no dispute on the duty paid nature of the same. Further, the question as to whether an input service is required to be subjected to service tax or not, cannot be examined at the time of availment of the same as held by various judicial pronouncements - all the three services are eligible as input services and therefore, service tax paid on the same is available to the appellant as Cenvat credit. Credit allowed - appeal allowed - decided in favor of appellant.

Summary

Issues involved: Admissibility of three services as input services for providing output services of telecommunication services.

Analysis:
1. Issue of Admissibility of Input Services:
The main issue in this case revolves around the admissibility of three services - Conference/Event Management Service, Maintenance Service for D.G. Sets, and Liasoning and Documentation Services - as input services for providing output services of telecommunication services. The Original Adjudicating Authority initially held that these services did not qualify as input services. However, the appellant argued that the admissibility of two of these services had been decided in their favor by a Single Member Bench of the Tribunal in a previous case. The appellant further cited various judicial decisions to support their claim that maintenance services and liaisoning services are essential for carrying out activities to provide output services, making them admissible as input services under the Cenvat Credit Rules, 2004.

2. Application of Legal Precedents:
The appellant relied on several judicial pronouncements, including decisions from the Tribunal and the Hon'ble Bombay High Court, to support their argument regarding the admissibility of the input services in question. They emphasized that the essential condition for admissibility of Cenvat credit on input services is whether the input service is used in providing output service. The appellant successfully demonstrated that there was no dispute regarding the use of the three input services in providing output services, nor on the duty paid nature of the services. The Tribunal agreed with the appellant's interpretation of the legal precedents and held that all three services were eligible as input services, making the service tax paid on them available to the appellant as Cenvat credit.

3. Decision and Conclusion:
After considering the submissions from both sides and reviewing the records, the Tribunal concluded that the three services in question were indeed eligible as input services for providing output services of telecommunication services. The impugned order that initially denied the admissibility of these services was set aside, and the appeal was allowed in favor of the appellant. The Tribunal's decision was based on the clear application of legal principles and precedents regarding the admissibility of input services for availing Cenvat credit, ensuring compliance with the Cenvat Credit Rules, 2004.

In summary, the judgment addressed the issue of admissibility of input services for providing output services of telecommunication services, highlighting the importance of demonstrating the use of input services in delivering output services and citing relevant legal precedents to support the decision in favor of the appellant.