2015 (10) TMI 1147 - AT - Central Excise

Appellant Granted Cenvat Credit for Various Expenses under Rule 9

The Tribunal allowed the appellant's claim for Cenvat Credit on various disputed expenses, including invoice discrepancies, telephone bills, service tax ... Denial of CENVAT Credit - Various services - Held that:- Telephone bills are in the name of head office and same has been used by the officials at their residence and residential premises has been taken on rent where as per rent deed no commercial activity can be carried out by the appellant. I find that in this case bills are raised for the mobile bills which have been used by the officials of the appellant. Therefore, as per Rule 9 of the Cenvat Credit Rules 2004 appellant is entitled to take Cenvat Credit thereon. For denial of Cenvat Credit of ₹ 3,38,880/- the reason is that the appellant has not produced job work agreement. In fact, the appellant has produced the job work agreement which revenue has not contravened without any cogent evidence that these premises were not used by the appellant in their job working activities. Therefore, I hold that appellant has correctly taken the Cenvat Credit. Services has been used by the appellant for dismantling of their plant and machinery located at their premises which was ultimately shifted to their new premises though same is integral part of their activity. Accordingly, I hold that appellant is entitled to take Cenvat Credit thereon. Further, the Chartered Accountant services have been availed by the appellant in the course of their business activity. Therefore, I hold that appellant is entitled to take Cenvat Credit - Decided in favour of assessee. Issues:1. Disallowance of Cenvat Credit on the grounds of invoice discrepancies2. Disallowance of Cenvat Credit on telephone bills in the name of head office3. Disallowance of Cenvat Credit on service tax paid for job worker premises4. Disallowance of Cenvat Credit on service tax paid for dismantling of old building5. Disallowance of Cenvat Credit on Chartered Accountant servicesAnalysis:1. The first issue pertains to the disallowance of Cenvat Credit amounting to &8377; 35,634/- due to invoice discrepancies. The Tribunal found that the services covered by these invoices were indeed utilized by the appellant. As per Rule 9 of the Cenvat Credit Rules 2004, the appellant was deemed entitled to claim Cenvat Credit for these services, leading to the allowance of the credit.2. The second issue involved the disallowance of Cenvat Credit worth &8377; 2414/- on telephone bills registered in the name of the head office. Despite the bills being utilized by officials at their residences, the Tribunal noted that these bills were for mobile services used by the appellant's officials. Consequently, in accordance with Rule 9 of the Cenvat Credit Rules 2004, the appellant was deemed eligible to claim Cenvat Credit on these expenses.3. The third issue addressed the disallowance of Cenvat Credit amounting to &8377; 3,38,880/- on service tax paid for premises where job working activities were carried out. The appellant presented the job work agreement, refuting the revenue's claim of non-usage of the premises for job working activities. The Tribunal, finding no substantial evidence to the contrary, ruled in favor of the appellant, allowing the Cenvat Credit.4. The fourth issue concerned the disallowance of Cenvat Credit totaling &8377; 8842/- for the dismantling of an old building. The Tribunal acknowledged that these services were utilized by the appellant for dismantling plant and machinery, which were then relocated to a new premises, constituting an integral part of their operations. Consequently, the Tribunal held that the appellant was justified in claiming Cenvat Credit for these expenses.5. Lastly, the disallowance of Cenvat Credit worth &8377; 21,630/- on Chartered Accountant services was addressed. The Tribunal recognized that these services were availed by the appellant in the course of their business activities, leading to the conclusion that the appellant was entitled to claim Cenvat Credit for these services. The Tribunal overturned the lower authorities' decision and allowed the appeals with consequential relief.