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2020 (11) TMI 621 - AT - Service TaxCENVAT Credit - proper invoices or not - validity of invoices/ bills issued to their office which is unregistered - requirement of Central Excise Registration or ISD Registration for availing CENVAT credit on the invoices issued on a different address - rule 4A of the 1994 Rules read with rule 9 of the 2004 Rules. HELD THAT - Once the requirement of rule 4A of the 1994 Rules and rule 9 of the 2004 Rules are satisfied, the benefit of CENVAT credit could not have been demanded. Thus, the Commissioner was not justified in denying the benefit of CENVAT credit on the unregistered premises. The Commissioner has further held that the benefit of CENVAT credit for services received by the Appellant on the strength of invoices addressed to another unit is not admissible as the Appellant failed to take Central Registration or ISD Registration to avail and distribute the CENVAT credit - This finding of the Commissioner is also not correct. There is no law that prescribes that the only way to distribute CENVAT credit is registering as an ISD. It has also contended by learned Counsel for the Appellant that no service tax was payable in respect of services imported prior to April 18, 2006. In this connection it has been pointed out that demand on ₹ 7038 was confirmed in respect of services imported from M/s P L Design Company Limited during the period 2005-06. The amount of service tax has been paid by the Appellant and it has also been appropriated in the impugned order. It is, therefore, not necessary to decide this issue. Except for the demand of ₹ 7038/- that has been appropriated, the remaining demands confirmed by the Commissioner in the impugned order are set aside - Appeal allowed - decided in favor of appellant.
Issues Involved:
1. Irregular availment of CENVAT credit on invoices not addressed to the registered premises. 2. Absence of central registration or ISD registration for distributing CENVAT credit. 3. Failure to discharge service tax liability on services received from abroad. 4. Interest liability on late payment of service tax. 5. Non-payment of 8% service tax for exempted services to Special Economic Zone (SEZ). Detailed Analysis: Issue 1: Irregular Availment of CENVAT Credit on Invoices Not Addressed to the Registered Premises The Commissioner ruled that the Appellant was not eligible for CENVAT credit on invoices not addressed to the registered premises, citing rule 4A of the Service Tax Rules, 1994, and rule 9 of the CENVAT Credit Rules, 2004. The Appellant argued that the registration of premises is not mandatory for availing CENVAT credit, referencing several judgments supporting this view. The Tribunal agreed with the Appellant, stating that the registration of premises is not a condition for availing CENVAT credit, and thus, the denial of CENVAT credit amounting to ?1,30,90,500 was incorrect. Issue 2: Absence of Central Registration or ISD Registration for Distributing CENVAT Credit The Commissioner held that the Appellant failed to obtain central registration or ISD registration, which is necessary for availing and distributing CENVAT credit. The Tribunal found this conclusion incorrect, stating there is no law mandating ISD registration as the only way to distribute CENVAT credit. The Tribunal cited previous judgments affirming that CENVAT credit cannot be denied on the basis of invoices addressed to unregistered premises. Issue 3: Failure to Discharge Service Tax Liability on Services Received from Abroad The Commissioner confirmed a demand of ?22,510 out of the total demand of ?2,80,975 for services received from abroad. The Appellant challenged the demand of ?7,038, arguing that no service tax was payable for services imported prior to April 18, 2006, referencing the Bombay High Court judgment in Indian National Shipowners Association vs. Union of India. The Tribunal acknowledged the payment and appropriation of the amount and deemed it unnecessary to decide further on this issue. Issue 4: Interest Liability on Late Payment of Service Tax The Appellant paid the interest liability of ?2,99,509 on late payment of service tax and did not challenge this in the appeal. Hence, this issue was not contested further. Issue 5: Non-Payment of 8% Service Tax for Exempted Services to SEZ The Commissioner dropped the demand of ?56,09,116 for non-payment of 8% service tax for exempted services to SEZ, stating no reversal is required for services rendered to an SEZ. The Appellant did not challenge this decision. Conclusion: The Tribunal set aside the remaining demands confirmed by the Commissioner, except for the appropriated amount of ?7,038. The appeal was allowed to the extent indicated, affirming that the registration of premises is not mandatory for availing CENVAT credit and that the Appellant was entitled to the credit on invoices addressed to unregistered premises.
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