Input service credit for rented business premises may be admissible where premises support office and credit distribution functions.

Cenvat credit on service tax paid for renting immovable property used as registered business premises was treated as prima facie admissible where the premises served office functions and business-related activities, including distribution of Cenvat credit to manufacturing units. The text notes that services used in relation to business activities, not only direct manufacturing operations, may satisfy the input service requirement. On that basis, the credit was considered prima facie relatable to business operations, and waiver of pre-deposit with stay of recovery was granted.

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Issues: Whether, for purposes of waiver of pre-deposit and stay, Cenvat credit taken on service tax paid on renting of immovable property used as registered business premises was prima facie admissible as an input service.

Analysis: The rented premises were used for the appellant's office and for activities connected with the business, including distribution of Cenvat credit to manufacturing units. The premises were registered with the department, and the available High Court decision was relied upon to hold that services used in relation to activities relating to business could satisfy the input service requirement. On that basis, the service tax paid on renting of such premises was found prima facie relatable to the appellant's business operations.

Conclusion: Cenvat credit on renting of immovable property was held prima facie admissible, and the appellant was granted waiver of pre-deposit and stay of recovery.

Ratio Decidendi: Services used in relation to the business of manufacture, including those connected with registered office premises and credit distribution functions, may prima facie qualify as input services for Cenvat credit purposes.

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