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2011 (7) TMI 456 - AT - Service Tax


Issues:
1. Eligibility of CENVAT Credit for various input services availed by the respondent.
2. Registration requirement for the head office as Input Service Distributor.
3. Dispute over the eligibility of courier services and clearing & forwarding services for availing credit.
4. Bar on demand by limitation and the requirement for filing supporting documents for CENVAT Credit.

Issue 1: Eligibility of CENVAT Credit for various input services:
The appeal was filed by the Revenue against the Commissioner (Appeals)'s order allowing CENVAT Credit for input services like Courier services, Clearing & Forwarding services, C.A. services, Maintenance and Repair services availed by the respondent. The respondent had obtained the credit based on invoices issued by their head office acting as an Input Service Distributor for services availed in January 2005.

Issue 2: Registration requirement for head office as Input Service Distributor:
The Revenue contended that the appellant's head office was not registered as an Input Service Distributor as required by the Service Tax (Registration of Special Category of Persons) Rules, 2005. However, it was noted that the legal requirement for such registration came into force in June 2005, while the credit was availed by the respondent in March 2005. Therefore, the Revenue's grievance on this issue was deemed unsustainable.

Issue 3: Dispute over eligibility of courier services and clearing & forwarding services:
The Tribunal referenced a previous case to establish that clearing and forwarding services, along with courier services, are eligible input services for availing credit. As the Revenue did not dispute the availability of credit for these services, the plea against their eligibility was found to be without merit.

Issue 4: Bar on demand by limitation and requirement for filing supporting documents:
The Commissioner (Appeals) had held that the demand was barred by limitation, stating that the assessee's submission of periodical returns to the Revenue was sufficient. The Revenue argued that filing returns alone was not enough and that supporting documents should be provided for taking CENVAT Credit. The judgment emphasized that the mere reflection of credit in the returns indicated the assessee's good faith, and the extended period for limitation could only apply in cases of intentional evasion. Since no evidence of malafide intent was presented, the demand was rightfully held to be barred by limitation.

In conclusion, the Revenue's appeal was rejected both on merit and limitation grounds, affirming the eligibility of the input services for CENVAT Credit and the sufficiency of the assessee's compliance with the filing requirements.

 

 

 

 

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