Cenvat credit refund cannot be denied for missing input service distributor registration where entitlement to credit is otherwise established.

Refund of accumulated Cenvat credit under Rule 5 was held not to be defeated merely because invoices were in the head office's name and the head office had not been registered as an input service distributor under Rule 7. The Tribunal noted that the assessee was otherwise entitled to take credit on the input services, the supporting documents were accepted as proper, and there was no evidence of any other unit requiring distribution of credit. Rule 7 was treated as relevant only where an assessee seeks to function as an input service credit distributor, so the procedural objection did not bar the refund claim.

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Issues: Whether refund of accumulated Cenvat credit was admissible when the bills stood in the name of the head office and the head office had not been registered as an input service distributor or followed the distribution procedure under Rule 7 of the Cenvat Credit Rules, 2004.

Analysis: The refund claim arose from unutilized Cenvat credit under Notification No. 5/2006-CE (NT) dated 14/3/2006 read with Rule 5 of the Cenvat Credit Rules, 2004. The claim was rejected below on the premise that the head office was not registered as a service tax distributor and that the procedural requirements of Rule 7 had not been followed. The Tribunal found that the appellant was otherwise eligible to avail Cenvat credit on the input services, that the documents were accepted as proper, and that the adverse inference regarding distribution of credit at other units was unsupported by the record. It was further found that Rule 7 would apply only where the assessee seeks to function as an input service credit distributor, and there was no evidence of any other unit in the relevant jurisdiction.

Conclusion: The procedural objection under Rule 7 did not defeat the refund claim, and the assessee was held entitled to the refund of accumulated Cenvat credit.

Final Conclusion: The rejection of refund was set aside and the assessee's claim for consequential relief was sustained.

Ratio Decidendi: A refund of accumulated Cenvat credit cannot be denied merely for non-compliance with input service distributor procedure where the assessee is otherwise entitled to the credit and the alleged non-compliance is neither required on the facts nor supported by evidence.

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