2016 (12) TMI 661 - AT - Service Tax

CENVAT credit - Security Services - GTA services - internet telephone services - Rent-a-Cab Service - whether the appellant is eligible for credit of service tax paid on various input services? - Held that - with regard to security services - On perusal of invoice, it is not clear whether appellant has incurred the expenses for availing the said services. It is also doubtful whether the Welfare Committee constituted has taken contribution from the members. Therefore, since the invoice is seen raised in the name of welfare committee and the appellant having failed to produce evidence to establish that the expenses have been fully incurred by the appellant, I hold that the denial of credit is proper. Security Services - GTA services - Held that - The credit availed on GTA service has been denied for the reason that the appellant has availed the service for transportation of goods upto buyers premises. It is not seen discussed in the order, whether such transportation is based on FOR destination. This aspect having not been considered by the authorities below, I am of the view that the appellant has to be given a chance to establish whether GTA services are availed under FOR destination. The circular issued by the Board No.97/8/2007-ST, dated 23-08-2007 clarifies that credit is admissible in respect of GTA service if the sale is on FOR basis upto the buyers premises. The Hon ble High Court in the case of CCE Vs Grey Gold cement 2014 (9) TMI 673 - Andhra Pradesh High Court has also held the issue in favour of assessee if on FOR destination basis - In view thereof, the issue whether appellant is eligible for credit on GTA services, is remanded to the adjudicating authority. The appellant shall be given an opportunity for personal hearing and also to submit additional evidence. Internet services - rent-a-cab services - Held that - credit is denied for the reasons that no documents have been produced by the appellant. Needles to say that the appellant cannot avail credit without proper documents. Therefore, I do not interfere with the credit disallowed in respect of internet service and rent-a-cab services. The impugned order is modified to the extent of remanding the issue with regard to GTA service to the adjudicating authority as observed in previous para. The credit in regard to Security Services, internet services, rent-a-cab services are disallowed. The appeals are party allowed in the above terms.

Summary

Issues:
- Eligibility of the appellant for credit of service tax paid on various input services including Security Services, GTA services, internet telephone services, and Rent-a-Cab Service.

Analysis:

Issue 1: Eligibility for credit of service tax paid on Security Services:
The judgment addresses the denial of credit on service tax paid for Security Services. The appellant claimed credit for Security Services, but it was denied as the invoice was raised in the name of the Hindustan Zinc Welfare Committee, not the appellant. The appellant argued that the residential colony was maintained as part of the factory in compliance with the Factories Act, 1948. However, the tribunal found that the appellant failed to provide evidence that the expenses were fully incurred by them. Since the invoice was in the name of the welfare committee and evidence was lacking, the denial of credit was upheld.

Issue 2: Eligibility for credit of service tax paid on GTA services:
Regarding GTA services, the appellant challenged the disallowance of credit for transportation services. The denial was based on the appellant availing the service for transportation of goods up to the buyer's premises. The tribunal noted that it was not clear whether the transportation was based on FOR destination. Referring to a circular and a High Court case, the tribunal decided to remand the issue to the adjudicating authority. The appellant was granted an opportunity for a personal hearing and to submit additional evidence to establish the eligibility for credit on GTA services.

Issue 3: Eligibility for credit of service tax paid on internet telephone services and Rent-a-Cab Service:
The credit availed for internet telephone services and Rent-a-Cab Service was denied due to the lack of produced documents by the appellant. The tribunal emphasized the necessity of proper documentation for availing credit. Consequently, the credit disallowed for internet service and rent-a-cab services was upheld. However, the judgment modified the order to remand the issue of GTA services back to the adjudicating authority for further consideration. The overall decision resulted in the dismissal of Appeal No. 191/2008 and partial allowance of Appeals 190 & 192/2008, specifically for the remanded issue of GTA services.