Cenvat credit through ISD invoices requires proper disclosure and prescribed distribution; extended limitation was prima facie inapplicable.

Cenvat credit on service tax paid for input services used in mines was held prima facie unavailable when the alleged ISD invoices did not properly disclose the recipient premises and the distribution mechanism did not satisfy Rule 7 of the Cenvat Credit Rules. The record noted that the mines had separate identity in different States and that the ore was supplied to more than one unit, which weakened the claim to credit through the stated ISD arrangement. On limitation, prior disclosure to the department meant the extended period was prima facie not invocable, so only the normal-period demand was considered for pre-deposit. Partial pre-deposit was directed and stay granted for the balance.

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Issues: (i) whether Cenvat credit of service tax paid on input services used in the mines was prima facie admissible to the appellant through ISD invoices; (ii) whether the extended period of limitation could be invoked for the demand.

Issue (i): whether Cenvat credit of service tax paid on input services used in the mines was prima facie admissible to the appellant through ISD invoices.

Analysis: The mines were found to have separate identity and were situated in different States, and the record showed that the bauxite ore was also supplied to another unit besides the Renukoot unit. The ST-I applications of the alleged input service distributors did not disclose the premises to which credit was intended to be distributed, and Rule 7 of the Cenvat Credit Rules requires distribution only in the manner prescribed and through a proper input service distributor. On that basis, the credit taken on such ISD invoices was held to be prima facie unavailable.

Conclusion: The prima facie claim to Cenvat credit was rejected.

Issue (ii): whether the extended period of limitation could be invoked for the demand.

Analysis: The appellant had informed the department earlier about availment of credit on services received at the mines through ISD invoices. In those circumstances, the invocation of the extended period was not accepted on a prima facie basis, and only the demand relatable to the normal period was taken into account for the pre-deposit direction.

Conclusion: The extended period was held to be prima facie inapplicable.

Final Conclusion: Partial pre-deposit was directed and stay was granted for the balance amount pending disposal of the appeal.

Ratio Decidendi: Cenvat credit through input service distributor invoices is not prima facie available where the distributing premises and intended recipient units are not properly disclosed and the arrangement does not satisfy the prescribed distribution mechanism under the Cenvat Credit Rules.

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