Cenvat credit on mobile phone services is admissible when used for business, without any installation requirement.

Cenvat credit of service tax paid on mobile phone services was treated as admissible where the services were used in or in relation to the assessee's business. Denial based on the phones not being installed in the business premises, and on an earlier Board circular, was unsustainable because the applicable credit rules did not impose an installation requirement. Prior decisions recognising business use of mobile phone services supported the availability of credit, and there was no allegation that the services were not used for business purposes.

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Issues: Whether Cenvat credit of service tax paid on mobile phone services was admissible to the assessee.

Analysis: The denial rested on the ground that mobile phones were not installed in the business premises and on reliance upon an earlier Board circular. The determining factor under the governing credit regime was whether the service was used in or in relation to the business of the assessee, and there was no allegation that the mobile phones were not so used. The absence of an installation requirement under the applicable credit rules, coupled with prior decisions recognising business use of mobile phone services, supported availability of credit.

Conclusion: Cenvat credit on mobile phone services was admissible and the denial was unsustainable.

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