2017 (2) TMI 1037 - AT - Central Excise

Tribunal allows cenvat credit for service tax payment via TR-6 Challan, citing judicial precedents.

CCE, Rohtak Versus Surya Roshni Ltd.

The Tribunal upheld the Commissioner (Appeals)'s decision, allowing the cenvat credit based on a TR-6 Challan for service tax payment by a Goods Transport ... CENVAT credit - duty paying documents - whether TR-6 Challan evidencing the payment of service tax by goods Transport Agency can be considered a valid document for taking cenvat credit as per Rule 9(1) of the CCR, 2004 during the period 01.01.2005 to 15.06.2005? Held that: - the issue involved in this appeal is no longer res integra. In the case of CCE, Goa vs. Essel Pro Pack Ltd. [2015 (5) TMI 529 - BOMBAY HIGH COURT], it was held that If no documents have been mentioned, TR-6 Challan has to be considered as a proper document, reflecting payment of such tax - the Revenue has not disputed the payment of service tax or entitlement to the cenvat credit. The above judgment of Hon’ble Bombay High Court is therefore squarely applicable to the facts of the present case - appeal dismissed - decided against Revenue. Issues: Validity of TR-6 Challan for availing cenvat credit as per Rule 9(1) of CCR, 2004 during a specific period.Analysis:Issue 1: Validity of TR-6 Challan for cenvat creditThe main issue in this case revolved around whether a TR-6 Challan, evidencing the payment of service tax by a Goods Transport Agency (G.T.A.), could be considered a valid document for availing cenvat credit as per Rule 9(1) of the CCR, 2004 during the period from 01.01.2005 to 15.06.2005. The Revenue contended that the notification prescribing TR-6 Challan as a valid document for cenvat credit was issued after the period in question. However, the Commissioner (Appeals) allowed the credit based on a Tribunal's order in a related case. The Tribunal, referring to a judgment of the Hon'ble Bombay High Court, emphasized that the Cenvat Credit Rules did not specify any documents for availing service tax credit during the disputed period for G.T.A. services. The Court highlighted that if no specific documents were mentioned, TR-6 Challan could be considered a proper document reflecting the tax payment, especially when the payment was not disputed. The Court also cited precedents emphasizing that if the duty payment was not disputed and the documents were genuine, the manufacturer would be entitled to cenvat credit.Issue 2: Judicial PrecedentsThe Tribunal referred to the judgment of the Hon'ble Bombay High Court in a related case and the decision of the Punjab & Haryana High Court to support its ruling. The Hon'ble Bombay High Court held that as long as the duty payment was not in question and the documents were genuine, the manufacturer should be entitled to cenvat credit. Similarly, the Punjab & Haryana High Court emphasized that if the duty paid had the character of inputs and their utilization in the final product was not disputed, the credit could not be denied. The Tribunal also mentioned a similar decision by the Hon'ble Madras High Court in another case, further supporting the validity of TR-6 Challan for availing cenvat credit.Issue 3: Application of PrecedentsIn the present case, the Revenue did not dispute the payment of service tax or the entitlement to cenvat credit. The Tribunal, following the precedent set by the Hon'ble Bombay High Court, upheld the Commissioner (Appeals)'s decision, stating that the TR-6 Challan could be accepted as proof of tax payment for availing cenvat credit. As the circumstances aligned with the legal principles established by the High Court, the Tribunal dismissed the Revenue's appeal, affirming the order of the Commissioner (Appeals).In conclusion, the Tribunal's decision in this case clarified the validity of TR-6 Challan as a document for availing cenvat credit during the specified period, relying on established legal principles and judicial precedents set by the Hon'ble Bombay High Court and other High Courts.