Cenvat credit through a registered input service distributor remains admissible when branch accounts are integrated with the head office.

Cenvat credit on input services received at branch offices was treated as admissible where the head office was registered as an input service distributor and the branch accounts were integrated with the head office. Although invoices were issued to the branches, the services and payments were recorded in the centralized head office accounts, and credit was distributed through the registered head office. On that structure, denial of credit merely because the branches were not separately registered or the invoices were not in the assessee's name was unsustainable. The disallowance of credit, interest, and penalty was accordingly set aside.

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Issues: Whether Cenvat credit on input services received at branch offices was admissible when the head office was registered as an input service distributor and the branch offices formed part of the head office accounts.

Analysis: The branch offices had no separate accounting system and their accounts were integrated with the head office, which held input service distributor registration. The invoices were issued to the branch offices, but the services and related payments were accounted for at the head office, and the credit was distributed through the registered head office. In these circumstances, the rejection of credit on the ground that the branch offices were not separately registered and that the invoices were not in the assessee's name was found to be unsustainable. The availment and distribution of credit were held to be proper and in accordance with the registration and accounting structure adopted by the assessee.

Conclusion: Cenvat credit was held admissible and the disallowance of credit, interest, and penalty was set aside in favour of the assessee.

Ratio Decidendi: Where branch offices form part of the head office's centralized accounts and the head office is duly registered as an input service distributor, credit on services received at the branches cannot be denied merely because the invoices were issued to the branch offices.

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