2014 (2) TMI 298 - AT - Service Tax

Appellant allowed Cenvat credit despite head office invoices: Legal implications clarified

The appellant was granted the entitlement to avail Cenvat credit of Service Tax paid despite invoices being issued in the name of the appellant's head ... Availment of CENVAT CRedit - Whether the appellant is entitled to avail the Cenvat credit of Service Tax paid by them where the invoices stand issue by the Service provider in the address of the appellant's head office - Held that:- where the invoices are in the name of head office or registered office, benefit of Cenvat credit cannot be denied, especially when there is no dispute about the receipt and utilization of Services - Board's Circular No.211/45/96-CX, dated 14-5-1996 clarified that Modvat credit would be available even when the invoices are in the name of Registered Office or Head Office. In the present case, I find that there is no dispute about the receipt of the Services by the appellant in their factory and about the availability of the Cenvat credit - Decided in favour of assessee. Issues involved:Whether the appellant is entitled to avail Cenvat credit of Service Tax paid when invoices are issued in the name of the appellant's head office.The judgment addresses a crucial issue concerning the entitlement of the appellant to avail Cenvat credit of Service Tax paid when invoices are issued in the name of the appellant's head office. The lower authorities had disallowed the credit and imposed penalties, considering the invoices as invalid. However, the presiding judge, Archana Wadhwa, highlighted that several decisions have established that denial of Cenvat credit based on invoices in the name of the head office is not valid, especially when there is no dispute regarding the receipt and utilization of services. The judge referenced cases like Gujarat Heavy Chemicals Ltd. Vs. Commissioner of Central Excise Rajkot [2005 (192) ELT 658 (Tri.-Mumbai)], Eveready Industries India Ltd. Vs. Commissioner of Central Excise, Lucknow [2007 (219) ELT 333 (Tri.-Del.)], and Racold Appliances Ltd. Vs. Commissioner of Customs & Central Excise, Pune [2003 (159) ELT 321 (Tri.-Mumbai)] to support this stance.Moreover, the judge pointed out that Board's Circular No.211/45/96-CX, dated 14-5-1996, clarified that Modvat credit should be available even when invoices bear the name of the Registered Office or Head Office. In the present case, there was no dispute regarding the receipt of services by the appellant at their factory and the availability of Cenvat credit. Therefore, following the precedents and circular mentioned, the judge set aside the impugned order, allowing the appeal and granting consequential relief to the appellant. The judgment emphasizes the importance of recognizing the validity of Cenvat credit claims based on invoices issued in the name of the head office, especially when there is no ambiguity regarding the actual receipt and utilization of services by the appellant.