Tribunal grants Cenvat Credit on Service Tax paid by service provider under reverse charge

The tribunal allowed the appeal, setting aside the impugned order and granting the appellant the right to avail Cenvat Credit on Service Tax paid on Man Power Services and Security Services under the reverse charge mechanism, even if the entire tax was paid by the service provider.

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Issues involved:
- Admissibility of Cenvat Credit on Service Tax paid on Man Power Services and Security Services under reverse charge mechanism.

Analysis:
The appeal was filed against an Order in Appeal passed by the Commissioner (Appeals) Central Excise-Ahmedabad. The main issue in question was whether the appellant, as the service recipient, could avail Cenvat Credit of Service Tax paid on Man Power Services and Security Services, where the burden of payment was 75% on the recipient and 25% on the service provider under the reverse charge mechanism. The appellant's advocate referred to a previous judgment by the tribunal in the case of M/s Gurudev Dyestuff (India) Pvt. Limited Vs. C.C.E Ahmedabad-II, where it was held that the credit is admissible even if the entire Service Tax was paid by the service provider. The advocate for the Revenue reiterated the Commissioner (Appeals) findings. The tribunal, in its analysis, considered the admissibility of CENVAT Credit on the Service Tax paid on Man Power Supply Service by the service provider. The tribunal concluded that the service recipient is entitled to CENVAT Credit of the total amount, even if the entire Service Tax was paid by the service provider. Consequently, the impugned order was set aside, and the appeal was allowed with any consequential relief as per law. The judgment was dictated and pronounced in the open court by Dr. D.M. Misra, Member (Judicial) of the Appellate Tribunal CESTAT AHMEDABAD.

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