2023 (8) TMI 604 - AT - Service Tax

CENVAT Credit - input services received by the appellant on the premises not indicated in their ST-2 certificate (registration certificate) - HELD THAT - The issue is no longer res integra and the Tribunal has in series of cases held that so far as the receipt of input services by the output service provider is not in dispute. The credit cannot be denied merely for the reason that these services were received at the premises other than the registered premises or the invoices against which the credit has been availed while showing the name of service recipient some other address which is not mentioned in the ST-2 certificate. Reliance placed in the case of M/S BRIDAL JEWELLERY MFG CO. VERSUS COMMISSIONER OF CUSTOMS, C.E. S.T., NOIDA 2017 (11) TMI 940 - CESTAT ALLAHABAD where it was held that The substantial benefit cannot be denied for mere technical or venial breach of the procedural law. In the case of M/S. ALLSPHERES ENTERTAINMENT PVT. LTD. VERSUS CCE, MEERUT 2015 (8) TMI 953 - CESTAT NEW DELHI where it was held that In the absence of any such dispute regarding availment of services and their utilization for payment of service tax or proper accounting of the same, the denial of Cenvat Credit of service tax paid by Nainital office of the appellant on the sole ground that the invoices issued are in the name of the appellants' unregistered office at Delhi is unjustified. Reliance placed in the case of MPORTAL INDIA WIRELESS SOLUTIONS (P.) LTD. VERSUS COMMISSIONER OF SERVICE TAX 2011 (9) TMI 450 - KARNATAKA HIGH COURT where it was held that CENVAT Credit cannot be denied for the reason that the appellant has produced a photocopy of the invoice. Such lapses have been held to be procedural lapse for which the credit availed will not become inadmissible. The credit in the present case could not have been denied for the reason stated in the impugned order - there are no merits in the same and the same is set aside - appeal allowed.

Summary

Issues:
The issues in the judgment involve disallowance of CENVAT Credit, imposition of penalties, and the question of whether CENVAT credit of service tax paid on input services can be allowed when received at premises not indicated in the ST-2 certificate.

Disallowance of CENVAT Credit and Penalties:
The appeal was directed against an Order disallowing CENVAT Credit and confirming a demand of Rs.1,22,364/- along with interest under Rule 14 of the CENVAT Credit Rules, 2004. Additionally, penalties were imposed under Section 76 and Section 77 (1) (c) (iii) of the Finance Act, 1994. The case revolved around the wrong availment of CENVAT credit of service tax paid on renovation services, where the appellant's registration address did not match the service location. The appellant challenged the order, arguing that the services were received and used for renovation, which was not disputed. The Tribunal cited various cases where similar service tax situations were allowed, emphasizing that the denial of credit for a technical breach was not justified.

Allowance of CENVAT Credit on Input Services:
The main issue for consideration was whether CENVAT credit of service tax paid on input services received at premises not indicated in the ST-2 certificate could be allowed. The Tribunal held that as long as the receipt of input services by the output service provider was not in dispute, credit could not be denied solely based on the service location not matching the registered premises. Various cases were referenced to support this stance, highlighting that procedural lapses or discrepancies in addresses did not render the credit inadmissible. The Tribunal emphasized that the substantial benefit should not be denied for minor technical breaches of procedural law.

Conclusion:
In conclusion, the Tribunal allowed the appeal, setting aside the disallowance of CENVAT credit based on the established legal principles and precedents. The judgment underscored the importance of focusing on the actual receipt and utilization of services rather than technical discrepancies in addresses or documentation. The decision highlighted that procedural lapses should not hinder legitimate claims for CENVAT credit, especially when the services were duly received and accounted for by the appellant.