Input service credit remains admissible for head-office invoices when services are used by different divisions, except ineligible entity-linked credit.

Input service credit was admissible where invoices were issued in the name of the head office but the services were actually used by different divisions of the same assessee. The credit for housekeeping, courier, freight and forwarding services transferred within the organisation was therefore allowed. However, the portion of credit attributable to Emco Energy Ltd. was treated as wrongly availed and had to be reversed. The operative principle is that internal use of input services within the assessee supports credit eligibility, while credit linked to a distinct ineligible entity does not.

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Issues: Whether input service credit was admissible where invoices stood in the name of the head office and the services were used by different divisions of the same assessee, and whether the credit relatable to Emco Energy Ltd. was liable to be reversed.

Analysis: The services in question, including housekeeping, courier, freight and forwarding services, were availed by the assessee and transferred to the divisions that actually used them. On that basis, the credit was held admissible for the services used within the assessee's organisation. The amount attributable to Emco Energy Ltd. was separately identified as wrongly availed.

Conclusion: Input service credit was allowed except for the amount attributable to Emco Energy Ltd., which was directed to be reversed.

Final Conclusion: The assessee succeeded on the principal claim to CENVAT credit, but was required to reverse the specific ineligible portion identified in the order.

Ratio Decidendi: Input service credit is admissible where the services are used by the assessee's divisions even if the invoices are in the name of the head office, but credit attributable to a distinct, ineligible entity must be reversed.

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