2019 (5) TMI 139 - AT - Central Excise

Tribunal remands cenvat credit denial decision, emphasizes need for verification

The Tribunal set aside the lower authority's denial of cenvat credit for various input services in the case. The appellant's detailed response explaining ... CENVAT Credit - input services - C&F Agent Import - C&F Agent-Warehouse - Management Consultant/CA Service - Commercial Training and Coaching - Business Support Services - Manpower Recruitment and Supply Services - Laundry Services - Management Fees - Security Services, etc. - denial on account of nexus - HELD THAT:- Though the appellant have made an elaborate submission of the use of the services but no supporting documentary evidence was produced - As regard the credit on proportionate basis, though the appellant have made a categorical submission before the adjudicating authority but the same was not considered by the adjudicating authority. The services even though used at the depot since that the said place is of removal, the credit is prima facie admissible to the appellant but since the documentary evidence needs to be submitted in support of actual use of the service, the entire matter needs to be re-considered - Appeal allowed by way of remand. Issues: Whether the appellant is entitled to cenvat credit for various input services, denial of credit by lower authority, lack of documentary evidence, services used outside factory premises, trading activity impact on credit.Analysis:1. The case involved the question of whether the appellant could avail cenvat credit for input services like C&F Agent Import, Management Consultant/CA Service, Security Services, etc. The lower authority had denied the credit, citing reasons such as lack of evidence for actual use of services, services used outside factory premises, and trading activity alongside manufacturing.2. The appellant, represented by Sh. S.R. Dixit, argued that they had provided a detailed response to the show cause notice, explaining the actual use of services. They claimed to have not availed credit for trading activity and had allocated credit proportionately. The appellant also contended that services used at a depot, considered as a place of removal, should be eligible for credit. Several judgments were cited in support of their arguments.3. Sh. L. Patra, appearing for the Revenue, reiterated the findings of the impugned order, supporting the denial of credit by the lower authority.4. The Tribunal, comprising MR. RAMESH NAIR and MR. RAJU, observed that while the appellant had elaborated on the use of services, no documentary evidence was presented. The Tribunal noted that the adjudicating authority had not verified the facts related to trading activity and proportionate credit allocation. Regarding services used at the depot, the Tribunal indicated a prima facie admissibility of credit but emphasized the need for supporting documentary evidence.5. Consequently, the Tribunal set aside the impugned order and remanded the matter to the adjudicating authority for a fresh decision. The authority was instructed to consider additional submissions from the appellant, review the judgments cited, and reassess the eligibility of cenvat credit for each service. The appeal was allowed for remand to the adjudicating authority for further examination and decision.