2013 (9) TMI 392 - AT - Service Tax

Cenvat Credit of Service Tax paid on input services - on the basis of bills in the name of their Head Office who could pass on the Service Tax Credit by registering itself as an input service distributor to its various branches - Invoices issued in the name of Head Office, which is not registered - Appellant directly took the credit on the basis of Bills not permissible under CENVAT Credit Rules, 2004 Held that - Effect that the invoices, even in the name of head office, are eligible documents for the purpose of credit. The said defects are omissions, which are totally curable defects and are condonable - denial on the sole ground of invoices being in the name of head office, is not justified.Decided in favor of Assessee. Limitation - Show Cause Notice stands issued beyond the normal period of limitation Held that - There is no column or provision in ER-1 return to show as to whether the invoices are in the name of appellant or in the name of head office Appellant not guilty of any suppression or mis-statement of facts with intent to evade duty. Extended period not applicable. Decided in favor of Assessee.

Summary

Issues:
Denial of CENVAT credit due to invoices being in the name of the head office without registration as an input service distributor.

Analysis:
The appellant wrongly availed Service Tax Credit based on invoices in the name of their Head Office, which did not have registration as an input service distributor. Both lower authorities upheld the demand, interest, and penalties, which the first appellate authority also confirmed. The appellant argued that services were received at the factory, and service tax was paid by the service provider, citing a precedent. The issue revolved around denial of credit due to invoices being in the head office's name without registration as an input service distributor.

The judge found no dispute regarding service receipt at the factory or payment of service tax by the appellant. The judge considered the issue a rectifiable error by endorsing the invoices in the factory's name. Referring to a previous judgment, the judge highlighted that the denial of credit solely based on invoices in the head office's name was unjustified. The judge also noted that the demand was beyond the normal limitation period, questioning the appellant's guilt of suppression or misstatement.

Ultimately, the judge deemed the impugned order unsustainable, setting it aside and allowing the appeal. The judgment emphasized rectifying the error by endorsing invoices in the factory's name and highlighted the unjust denial of credit based on the head office's name in the invoices.