Cenvat credit on job worker services upheld where tax payment and service receipt were undisputed despite exemption objection.

Credit of service tax paid by a job worker on services received in the assessee's factory was held admissible under Rule 3 of the Cenvat Credit Rules, 2004. The revenue's objection based on exemption under Notification No. 8/2005-S.T. did not defeat entitlement because the tax payment and receipt of service were undisputed, and earlier Tribunal decisions had already accepted credit in similar circumstances. The departmental challenge therefore failed and the order allowing credit was sustained.

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Issues: Whether credit of service tax paid by a job worker on services received by the assessee was admissible under Rule 3 of the Cenvat Credit Rules, 2004, despite the revenue's objection based on exemption under Notification No. 8/2005-S.T. dated 1-3-2005.

Analysis: The service tax paid by the job worker and the receipt of service in the assessee's factory were not disputed. The earlier Tribunal decisions relied upon by the first appellate authority had already recognised entitlement to credit in similar circumstances, and no contrary authority was shown.

Conclusion: The credit was admissible and the assessee's entitlement was upheld.

Final Conclusion: The departmental challenge failed and the order allowing credit was sustained.

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