Tribunal overturns denial of credit for input service due to lack of separate registration, ruling in favor of appellant.

The Tribunal set aside the order-in-appeal, ruling in favor of the appellant, stating that denial of credit on input service due to lack of separate registration for the premise was not valid. The appellant's argument was supported by relevant case law, and the Tribunal found the denial of credit for renting of immovable property service contradictory given the acknowledgment of mixed services provided from the premise. The reversal of credit under Rule 6(3) was deemed unsustainable, leading to a favorable outcome for the appellant.

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Issues: Appeal against order-in-appeal regarding admissibility of cenvat credit on input service and reversal of credit under Rule 6(3) of Cenvat Credit Rules 2004.

Analysis:
1. The appellant provided taxable service under Business Auxiliary Service from two premises, one of which was also used for trading of rubber products. The department issued show cause notices for inadmissible credit on renting of immovable property service and reversal of cenvat credit under Rule 6(3) for providing exempted services.

2. The appellant reversed the cenvat credit as directed but appealed against the reversal order. The Chartered Accountant argued that denial of credit on input service due to lack of separate registration for the premise was not valid, citing relevant case laws.

3. The Revenue supported the findings of the Commissioner (Appeals). The Tribunal deliberated on whether the appellant was entitled to cenvat credit on the service tax paid for renting of immovable property related to one of the premises.

4. The Tribunal noted that the appellant provided both taxable and exempted services from the premise in question, with all invoices raised from another unit. Acknowledging the mixed activities, the department had directed the reversal of credit for exempted services.

5. The Tribunal agreed with the appellant's argument that denial of credit for renting of immovable property service based on lack of separate registration was not sustainable. Citing relevant case law, the Tribunal held that since the department acknowledged the mixed services provided from the premise, denial of credit on the input service was contradictory and set aside the impugned order in favor of the appellant.

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