2013 (12) TMI 440 - AT - Service Tax

Availment of CENVAT Credit - Debit notes - Revenue contends CENVAT Credit cannot be availed on the strength of debit notes - Whether, whether credit can be availed on the strength of debit notes - Held that - purpose of prescribing a document for availment of credit is to enable the Revenue to verify the fact of payment of service tax by the service provider and the receipt and consumption of service by the service recipient in further provision of output service. The prescription of document is only a machinery provision for achieving the object of law. In the present case, Rule 4A of the Service Tax Rules, 1994 does not prescribe any format of document to be issued by the service-provider. It only specifies what are the particulars which should be contained in the document. These particulars are, namely and, address of the service provider, service tax registration number, name and address of the service recipient, description of the service rendered and the value thereof and the service tax paid. If this information is available in any document, the same would constitute a valid document for the purpose of availing CENVAT credit. The appellant has obtained centralized registration accordingly at the relevant time. All the invoices for the input services were received and also addressed to the registered office of the appellant. In view of the explicit provision in law for centralised registration, the denial of CENVAT credit on the ground that individual premises from where service is rendered were not registered, is clearly unsustainable - Decided in favour of assessee.

Summary

Issues:
1. Eligibility for CENVAT credit on service tax paid on monthly rentals.
2. Validity of debit notes as prescribed documents for availing CENVAT credit.
3. Requirement of registration of individual premises for availing credit.

Analysis:
1. The appellant provided 'Business Auxiliary Service' to a client and availed CENVAT credit on service tax paid on monthly rentals. The department contended that the appellant was not eligible for credit due to issues with the debit notes and non-registration of individual premises. A show cause notice was issued, leading to the current appeal.

2. The appellant argued that the debit notes issued by the client contained all required particulars as per Rule 4A of the Service Tax Rules, 1994, making them valid documents for CENVAT credit under Rule 9 of the CENVAT Credit Rules, 2004. The appellant also highlighted the flexibility in document format as long as essential information is provided. The Tribunal agreed, citing precedents, and ruled in favor of the appellant on this issue.

3. Regarding the registration of individual premises, the appellant's centralized billing and accounting setup at their registered office satisfied the requirements of Rule 4(2) of the Service Tax Rules, 1994. The Tribunal found the denial of CENVAT credit on this ground unjustifiable, emphasizing the legality of the appellant's credit availing process.

4. The Revenue argued against credit availing based on debit notes and the need for registration of all service-rendering premises. However, the Tribunal rejected these arguments, emphasizing the substance over format principle and the legislative flexibility in document requirements. Citing relevant case law, the Tribunal found the demands against the appellant unsustainable in law, allowing the appeal and disposing of related proceedings accordingly.