2020 (1) TMI 583 - AT - Central Excise

CENVAT Credit - input service distribution - Credit has been denied to the appellant which has been distributed by the Input Service Distributor (ISD) - whether Cenvat Credit can be denied to the appellant who has received the Cenvat Credit on distribution by ISD and the availment of Cenvat Credit has not been disputed at the end of the ISD? - HELD THAT - The said issue has been examined by this Tribunal in the case of M/S HENKEL ANAND INDIA PVT LTD VERSUS COMMISSIONER OF CE ST, GURGAON-I 2020 (1) TMI 369 - CESTAT CHANDIGARH where it was held that Admittedly, the distribution of the Cenvat credit has not been disputed, therefore, the appellant is entitled to avail Cenvat credit on this ground only. The admissibility of Cenvat Credit by the appellant cannot be disputed at this stage - appeal allowed - decided in favor of appellant.

Summary

Issues Involved: Appeal against denial of Cenvat Credit by Input Service Distributor (ISD) for services like 'Club & Association' and 'Transport of Passengers by Air'.

Analysis:
1. Issue of Cenvat Credit Denial: The appellant appealed against the denial of Cenvat Credit by the Revenue, which was distributed by the Input Service Distributor (ISD) for services used by the appellant. The Revenue contended that the services were not input services as per Rule 2(l) of the Cenvat Credit Rules, 2004, hence, the appellant was not entitled to avail Cenvat Credit on these services. The key question was whether Cenvat Credit could be denied to the appellant when the ISD had distributed the credit, and the admissibility of Cenvat Credit had not been challenged by the Revenue at the ISD's end.

2. Legal Submissions: The appellant's counsel argued that since the admissibility of Cenvat Credit had not been disputed by the Revenue at the ISD's end, the appellant's right to avail the credit should not be questioned. On the other hand, the Authorized Representative for Revenue reiterated the impugned order denying the Cenvat Credit.

3. Precedent and Tribunal's Decision: The Tribunal referred to a previous case involving a similar issue, M/s Henkel Anand India Pvt. Ltd. vs. Commissioner of C. E & ST, where it was observed that the appellant was entitled to avail Cenvat Credit if the distribution of credit by the ISD was not disputed. The Tribunal also cited a decision of the Hon'ble High Court of Bombay to support the appellant's right to avail the credit. The Tribunal concluded that since the distribution of Cenvat Credit was not disputed, the appellant was entitled to avail the credit, setting aside the impugned order and allowing the appeal.

In summary, the Tribunal ruled in favor of the appellant, holding that the denial of Cenvat Credit by the Revenue was not justified when the admissibility of the credit had not been challenged at the ISD's end. The decision was based on precedents and legal provisions governing the distribution and availment of Cenvat Credit, ultimately allowing the appellant to avail the credit distributed by the ISD for the services in question.