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of <h1>Appellant entitled to CENVAT credit of Rs.4,06,163 after separate branch service registration and tax payment; demand, interest, penalty set aside</h1> <h3>Ifb Industries Limited Versus C.S.T. -Service Tax, Ahmedabad</h3> CESTAT, Ahmedabad (AT) allowed the appeal and held the appellant entitled to CENVAT credit of Rs.4,06,163. The tribunal found that the appellant held ... CENVAT Credit - denial of cenvat credit only on the ground that since the appellant’s service unit is part of their Goa unit, therefore, they cannot separately operate as independent service provider - HELD THAT:- It is found that even though the appellant service tax registration is on the common PAN based but the appellant have taken separate registration for their Ahmedabad service branch. They are also discharging service tax on the output service of repair and maintenance of equipment and appliances of IFB Industries Limited. Therefore, once the department has accepted the payment of service tax on their output service, the cenvat credit cannot be denied on the input services which are used for providing output service. Accordingly, the appellant is entitled for the cenvat credit amount of Rs. 4,06,163/. The demand of such cenvat credit and corresponding interest and penalty are set aside - Appeal allowed. Appeal against Order-in-Appeal upholding demand of CENVAT credit of Rs. 4,06,163 with interest and penalty. Appellant is a branch providing repair & maintenance services to customers of the principal company, discharging service tax on those output services and availing CENVAT credit on input services and overheads (advertisement, telephone, bank charges, insurance). Lower authorities denied credit on ground that the branch, being part of the Goa unit under common PAN, could not operate as an independent service provider. Tribunal found that the appellant held a separate service tax registration for the Ahmedabad branch and was 'discharging service tax on the output service of repair and maintenance,' and therefore 'once the department has accepted the payment of service tax on their output service, the cenvat credit cannot be denied on the input services which are used for providing output service.' Demand, corresponding interest and penalty set aside; appeal allowed and CENVAT credit of Rs. 4,06,163 upheld.
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