Cenvat credit on cleaning services upheld where tax was already paid through valid challans and later regularised by the invoice issuer.

Cenvat credit was held admissible on cleaning services where tax had already been discharged through valid TR-6 challans by the sister concern during the relevant period, and the records showed that the services were supplied under the same management and premises. The later service tax registration and fresh payment by the invoice-issuing concern, together with interest, supported the conclusion that credit could not be denied merely because the invoice issuer was initially unregistered. The penalty under Rule 15 of the Cenvat Credit Rules was therefore not sustainable, and the impugned order was set aside.

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Issues: Whether Cenvat credit was admissible when the service provider mentioned in the invoice had not initially obtained service tax registration or paid tax, but tax was discharged through TR-6 challans by the sister concern and later paid again by the invoice-issuing concern with interest, and whether the penalty under Rule 15 of the Cenvat Credit Rules was sustainable.

Analysis: The disputed credit related to cleaning services received during the relevant period. The invoices were issued by one concern, while the related service tax liability was being discharged under TR-6 challans by its sister concern, which had service tax registration and had informed the department that the services were being provided through the sister concern under the same management and premises. TR-6 challans were valid duty paid documents during the material period, and the credit was therefore taken against a document evidencing discharge of tax. The later registration and fresh payment of service tax by the invoice-issuing concern, along with interest, further supported the view that denial of credit would not be justified in the circumstances.

Conclusion: Cenvat credit was admissible and the penalty was not sustainable.

Final Conclusion: The impugned order was set aside and the assessee's appeal succeeded.

Ratio Decidendi: Where tax on the same services has been duly discharged through a valid duty paid document and the surrounding records establish payment of service tax for the relevant period, Cenvat credit cannot be denied merely because the invoice-issuing concern initially lacked registration or later regularised the payment position.

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