2021 (4) TMI 852 - AT - Central Excise

CENVAT Credit - input services - Appellant undertook renovation project of their sugar unit and for that work they have engaged M/s. Manana Construction and M/s. ISGEC Heavy Engineering Ltd. - works contract - period from January 2016 to March 2016 - HELD THAT - As per the submission of the appellant, the appellant has entered into three different contracts with Manana Construction viz. supply of material for civil construction, supply of labour for civil construction and supply of labour for installation of plant and machinery and as per the appellant he is liable to pay service tax only on supply of labour for civil construction and supply of labour for installation of plant and machinery and is not liable to pay service tax on supply of material for civil construction and further as per the appellant, he has already reversed ₹ 8,40,768/- on proportionate basis, the service tax pertaining to supply of labour for civil construction and the remaining amount is entitled to avail as cenvat credit of the same and similarly for ISGEC Heavy Engineering the appellant submitted that they have entered into two different contracts but all the contracts entered into between the appellant and two different parties viz. Manana Construction and M/s. ISGEC Heavy Engineering Ltd. have not been produced before the original authority to verify the claim of the appellant. This case needs to be remanded back to the original authority to examine all the documents afresh and then decide the claim of the appellant and determine the demand, if any - Appeal allowed by way of remand.

Issues:
1. Appeal against rejection of cenvat credit by Commissioner (Appeals).
2. Appellant's engagement with Manana Construction and ISGEC Heavy Engineering Ltd.
3. Dispute over availing cenvat credit on service tax and Swach Bharat cess.
4. Arguments regarding nature of contracts and tax liability.
5. Lack of production of relevant documents before the original authority.
6. Consideration of remand for further examination of agreements and invoices.

Detailed Analysis:

Issue 1:
The appellant filed an appeal against the rejection of cenvat credit by the Commissioner (Appeals), challenging the impugned order dated 14/09/2018.

Issue 2:
The appellant, a Co-operative Sugar Factory, engaged with M/s. Manana Construction and M/s. ISGEC Heavy Engineering Ltd. for a renovation project of their sugar unit, leading to a dispute over availing cenvat credit on service tax and Swach Bharat cess.

Issue 3:
The Department observed that the appellant wrongly availed cenvat credit on service tax and Swach Bharat cess, leading to a show-cause notice and subsequent confirmation of the demand, which was upheld on appeal by the Commissioner.

Issue 4:
The appellant argued that they entered into different contracts with Manana Construction and ISGEC Heavy Engineering Ltd., emphasizing the nature of the contracts and tax liability based on the services provided.

Issue 5:
The learned AR contended that essential documents, including agreements and work orders, were not produced before the original authority, hindering a thorough examination of the nature of agreements and cenvat credit availed by the appellant.

Issue 6:
After hearing both parties and reviewing the submissions, the Tribunal found discrepancies in the production of relevant documents before the original authority. Consequently, the Tribunal decided to remand the case back to the original authority for a fresh examination of all agreements, work contracts, and invoices to determine the appellant's claim and any potential demand. The appellant was directed to provide all relevant documents, and the original authority was instructed to decide on the claim within three months.

This comprehensive analysis highlights the key issues involved in the legal judgment, emphasizing the dispute over cenvat credit, the nature of contracts, and the necessity for a remand to ensure a thorough examination of relevant documents.

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