Cenvat credit on input services upheld where payment and invoice dates satisfied the amended Rule 3 conditions.

Entitlement to Cenvat credit on input services depended on Rule 3(1) of the Cenvat Credit Rules, 2002 and the proviso governing the date of payment and the invoice or bill of challan. The amended rule permitted credit under clause (a) for input services in the same category of taxable service where the invoice or bill of challan was issued on or after 16.08.2002, and under clause (b) in other cases where it was issued on or after 14.05.2003. As the payment dates in the annexure showed that all bills were paid after 14.05.2003, and the credit was taken during July 2013 to September 2013, the credit was not inadmissible under Rule 3(1)(b) and denial of credit was unsustainable.

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Issues: Whether the appellant was entitled to avail Cenvat credit on the input services in view of Rule 3(1) of the Cenvat Credit Rules, 2002 and the proviso relating to the date of payment and invoice or bill of challan.

Analysis: The dispute turned on the amended Rule 3, which allowed credit under clause (a) for input services in the same category of taxable service where the invoice or bill of challan was issued on or after 16.08.2002, and under clause (b) in other cases where the invoice or bill of challan was issued on or after 14.05.2003. The respondent authorities proceeded only on clauses (a) and (b) and ignored the proviso. The payment dates in the annexure showed that payment for all bills was made after 14.05.2003, and the credit was availed during July 2013 to September 2013.

Conclusion: The appellant's credit was not inadmissible under Rule 3(1)(b) of the Cenvat Credit Rules, 2002, and the denial of credit was unsustainable.

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