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2023 (12) TMI 119 - AT - Central ExciseCENVAT Credit - time limitation - credit was taken on the input service after long span of 1 to 4 years - credit of security service was denied as the same was used for the unit as well as the residential premises of the director and branch office - denial on the ground that the invoices do not pertain to the appellant - denial on the ground that the invoices do not contain the service tax registration No. of the supplier of input services. Denial on the ground that credit was taken on the input service after long span of 1 to 4 years - HELD THAT - The reason given for denial of cenvat credit of Rs.77,74,439/- by the Adjudicating Authority that since one year period is provided under Section 11A for demanding of duty the same shall apply for availment of Cenvat credit also. This reason given by the Adjudicating Authority, in our considered view is absolutely absurd and not relevant. The Cenvat Credit Rules, 2004 is independent in itself and in dealing with the Cenvat credit matters, finding given is irrelevant and cannot be imported from the other Rules or Act. Section 11A is strictly for the purpose of issuing show cause notice for demanding of duty even for demanding wrongly availed Cenvat credit, but for the purpose of availment of Cenvat credit, Cenvat Credit Rules, 2004 is applicable - the import of Section 11A to say that 1 year period provided in Section 11A shall apply in the case of availment of Cenvat credit is absolutely illegal, incorrect and imaginary. The Hon ble Delhi High Court in the case of Global Ceramic Pvt Ltd 2019 (5) TMI 1432 - DELHI HIGH COURT clearly held that the time limit shall not apply for the period prior to 11.07.2014 when the amendment of 1 year time limit was prescribed. Thus, the period of 1 year is not applicable during the period when there was no time limit prescribed for availment of Cenvat credit. Therefore, the appellant are eligible for Cenvat credit of Rs. 77,74,439/-. Credit on security service - Denial on the ground that the security service was used for the residential premises of the Director and branch office - HELD THAT - A very small portion of the service was used in respect of the residential premises of the Director. However, remaining majority of portion of service was used in relation to the business activity by the appellant. Therefore, only the Cenvat credit attributed to the input security service related to the residential premises of Director shall not be available. However, the appellant have reversed the Cenvat credit of Rs. 8189/-. In respect of security service related residential premises of the Director the said reversal is upheld and maintained. However, the remaining amount of Cenvat credit of security service is admissible to the appellant. Credit denied on the allegation that the invoices do not pertain to the appellant - HELD THAT - Though the invoices copy is not available, however, there is no case of the department that the input service related to this credit was not received by the appellant and used for their overall business operation. It is the submission of the appellant that the invoices were accounted for in the books of account. Therefore, the receipt of service and use thereof is not in dispute, merely because name of the appellant is not mentioned or incorrectly mentioned the credit cannot be denied for this clerical error. Accordingly, the appellant is eligible for Cenvat credit of Rs. 75,752/- also. Credit denied on the ground that invoices do not contain the service tax registration of the supplier of input services - HELD THAT - Except this small lapse there is no dispute that the appellant have received the invoices, services and the payment of such invoices to the supplier of input service. Therefore, merely because registration no. is not mentioned credit cannot be denied - it is settled that merely because service tax registration was not mentioned on the invoices credit cannot be denied - appellant are eligible for Cenvat credit on the invoices which are not bearing the registration number. The appellant are eligible for Cenvat credit, on all the counts - appeal allowed.
Issues Involved:
1. Denial of Cenvat credit due to delayed availing. 2. Denial of Cenvat credit for security services used for residential premises. 3. Denial of Cenvat credit due to invoices not pertaining to the appellant. 4. Denial of Cenvat credit due to missing service tax registration numbers on invoices. Summary: 1. Denial of Cenvat Credit Due to Delayed Availing: The appellant was denied Cenvat credit of Rs. 77,74,439/- on the grounds that it was availed after a period of 1 to 4 years. The Tribunal found this reasoning to be "absolutely absurd and not relevant," noting that the Cenvat Credit Rules, 2004, are independent and do not import time limits from Section 11A. The Tribunal emphasized that during the relevant period, no time limit was prescribed for availing Cenvat credit. The appellant provided sufficient evidence, including Chartered Accountant certificates and account books, proving the receipt and payment for input services. The Tribunal cited multiple judgments, including from the Hon'ble Delhi High Court in the case of Global Ceramic Pvt Ltd, supporting the position that no retrospective time limit applies for availing Cenvat credit. Thus, the Tribunal held that the appellant is eligible for the Cenvat credit of Rs. 77,74,439/-. 2. Denial of Cenvat Credit for Security Services Used for Residential Premises: The Cenvat credit of Rs. 2,21,112/- was denied as it included security services for the residential premises of the director. The appellant conceded that a small part of the service was related to the residential premises and reversed the credit of Rs. 8189/-. The Tribunal upheld this reversal but allowed the remaining credit, which was used for business activities. 3. Denial of Cenvat Credit Due to Invoices Not Pertaining to the Appellant: The credit of Rs. 75,762/- was denied on the grounds that the invoices did not pertain to the appellant. The Tribunal found that there was no dispute regarding the receipt and use of the input service, and the invoices were accounted for in the appellant's books. The Tribunal held that credit cannot be denied merely due to clerical errors in the invoices and allowed the Cenvat credit of Rs. 75,762/-. 4. Denial of Cenvat Credit Due to Missing Service Tax Registration Numbers on Invoices: The credit of Rs. 1,82,602/- was denied because the invoices did not contain the service tax registration number of the supplier. The Tribunal noted that there was no dispute regarding the receipt and use of the services or the payment for the invoices. It cited several judgments, including from the Bangalore and Mumbai Tribunals, which held that credit cannot be denied for minor procedural lapses if the substantive requirements are met. The Tribunal concluded that the appellant is eligible for the Cenvat credit of Rs. 1,82,602/-. Conclusion: The Tribunal allowed the appeal, granting the appellant the Cenvat credits for all the disputed amounts, and set aside the impugned order with consequential relief.
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