2009 (8) TMI 382 - AT - Service Tax

Appellate Tribunal overturns decision denying Cenvat credit for various services; emphasizes adherence to legal provisions.

The Appellate Tribunal set aside the Commissioner (Appeals) order that had overturned the original decision allowing Cenvat credit to the appellant for ... Cenvat Credit- Goods Transport services-Mobile phone service-credit card services-air travel agent- , the Adjudicating Authority has held that the appellants are entitled for Cenvat credit on the services as they have availed the credit within the provisions of law. Aggrieved by the said order, the revenue preferred an appeal before the Commissioner (Appeals). The Commissioner (Appeals), in turn, set aside the order passed by the Adjudicating Authority. Held that- the Commissioner (Appeals) setting aside the order, only in brief has held that the Cenvat Credit availed by the appellants are against the provisions of law, which is not acceptable, thus impugned order is set-aside. Appeal is allowed. Issues:1. Availment of Cenvat credit on various services - goods transport, mobile phone, credit card, and air travel agent.2. Allegations of contravening Cenvat Credit Rules, 2004.3. Original order allowing Cenvat credit.4. Appeal by revenue against original order.5. Commissioner (Appeals) setting aside original order.6. Appellate Tribunal's decision on the appeal.Issue 1: Availment of Cenvat credit on various servicesThe appellant availed Cenvat credit on services like goods transport, mobile phone, credit card, and air travel agent. The show-cause notice alleged that this credit was wrongly claimed, citing provisions of rules 3, 4, and 9 of Cenvat Credit Rules, 2004.Issue 2: Allegations of contravening Cenvat Credit Rules, 2004The show-cause notice contended that the appellant contravened the rules by availing credit on services like goods transport, mobile phone, credit card, and air travel agent. Specific allegations included post-manufacturing activity for goods transport service, inadmissibility of credit for mobile phone service as per a Board's Circular, and services not being related to manufacturing for credit card service and air travel agent.Issue 3: Original order allowing Cenvat creditThe Adjudicating Authority initially allowed the Cenvat credit on the mentioned services, finding that the appellant complied with the law. However, the revenue challenged this decision, leading to an appeal before the Commissioner (Appeals).Issue 4: Appeal by revenue against original orderThe revenue appealed against the original order of the Adjudicating Authority, disagreeing with the allowance of Cenvat credit to the appellant for the specified services.Issue 5: Commissioner (Appeals) setting aside original orderThe Commissioner (Appeals) set aside the original order that favored the appellant, indicating that the Cenvat credit availed was against the provisions of the law.Issue 6: Appellate Tribunal's decision on the appealUpon hearing both parties and examining the records, the Appellate Tribunal found that the Adjudicating Authority had thoroughly reviewed the use of the services in question and correctly allowed the Cenvat credit. The Tribunal noted that the Appellate Authority did not provide any findings on the matter. Consequently, the Tribunal set aside the Commissioner (Appeals) order, allowing the appeal and granting consequential relief to the appellant.This detailed analysis highlights the progression of the case from the original order allowing Cenvat credit to the final decision by the Appellate Tribunal, emphasizing the importance of proper examination and compliance with legal provisions in such matters.