Input service distributor registration controls Cenvat credit relief; partial pre-deposit granted and balance recovery stayed.

Input service invoices raised in the name of a head office, while services are used across different units, require the head office to be registered as an input service distributor and to issue invoices to the units under the Cenvat Credit Rules, 2004. On the facts presented, the Tribunal found a prima facie procedural lapse because the head office was not so registered, which weighed against complete waiver of pre-deposit and stay of recovery. Balancing the revenue interest and the appellant's position, the Tribunal granted only partial relief and directed a limited pre-deposit, with recovery of the balance stayed during the appeal.

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Issues: Whether the appellant was entitled to waiver of pre-deposit and stay of recovery in respect of the demand raised on disallowance of Cenvat credit on input services.

Analysis: The appellant sought waiver on the ground that the invoices stood in the name of its head office while the services were used at different units. The Tribunal noted that, where input service invoices are raised in the name of the head office or circle office and the services are used across different units, the head office is required to be registered as an input service distributor and to issue invoices to the units. As the head office had not been registered as such, the Tribunal found a prima facie failure to follow the procedure prescribed under the Cenvat Credit Rules, 2004. At the same time, considering the factual position and balancing the interests of revenue, the Tribunal granted partial relief by directing a limited pre-deposit and staying recovery of the balance during pendency of the appeal.

Conclusion: The prayer for complete waiver was rejected, but partial waiver was granted on condition of depositing Rs. 13 lakhs, with the balance stayed pending appeal.

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