2014 (11) TMI 752 - AT - Service Tax

Appellant granted CENVAT Credit on construction and engineering services under Cenvat Credit Rules, 2004

The Tribunal allowed the appellant to avail CENVAT Credit on construction services and consulting engineering services for the period, setting aside the ... CENVAT Credit - construction service and consulting engineer service - Held that:- Appellant is entitled to take CENVAT Credit on the construction services and consulting engineering services availed by it during the financial year 2007-08 being prior to 1.4.2011 when such CENVAT Credit was expressly disallowed by amendment of the Rules. Further, I hold that the whole proceedings against the appellant were misconceived. Hence, the impugned order is set aside - appellant is permitted to take CENVAT Credit - Decided in favour of assessee. Issues:- Availability of CENVAT Credit on construction service and consulting engineer services for providing output services.Analysis:The appellant, engaged in taxable services, availed CENVAT Credit on construction service and consulting engineer services for the period October 2007 to March 2008. The Revenue contended that these services were not used for providing output service, leading to a show-cause notice being issued. The Commissioner (Appeals) confirmed the demand and penalty, prompting the appellant to appeal before the Tribunal.The appellant argued that during the relevant period, CENVAT Credit was legitimately available on the mentioned services, enabling the provision of convention services and Mandap Keeper Services. The appellant sought the appeal's allowance, along with the re-credit benefit due to the earlier reversal made before the show-cause notice issuance, arguing against the applicability of proceedings under Section 73.The Tribunal, after considering the arguments, held that the appellant was entitled to the CENVAT Credit on construction services and consulting engineering services utilized during the financial year 2007-08, as these services were allowable under Rule 2(l) read with Rule 3 of the Cenvat Credit Rules, 2004. The Tribunal deemed the proceedings against the appellant as misconceived, setting aside the impugned order, allowing the appeal, and permitting the appellant to take CENVAT Credit of Rs. 4,54,620. The appellant was also granted consequential benefits arising from the order.