Tribunal grants appeal, overturns denial of Cenvat credit based on service providers' registration issue.

The Tribunal allowed the appeal, setting aside the decision of the Commissioner (Appeals) and holding that denying Cenvat credit based on supplementary invoices due to service providers' lack of registration at the time of service provision was unjustified. Despite the service providers obtaining registration and paying Service tax later, the appellant's use of input services for taxable output services was established. As there was no dispute regarding the receipt and use of the services, the Tribunal ruled that the Cenvat credit could not be refused, leading to the appeal being allowed with consequential relief.

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Issues:
Denial of Cenvat credit on the basis of supplementary invoices due to service providers not being registered at the time of providing taxable services.

Analysis:
The case involved the appellant receiving taxable services from service providers who were not registered with the Central Excise Department at the time of providing the services. The service providers later obtained service tax registration and paid the Service tax under supplementary invoices. The Department denied the Cenvat credit to the appellant based on the lack of registration of the service providers at the time of providing the services. A show cause notice was issued, and the Asstt. Commissioner confirmed the Cenvat credit demand and imposed a penalty. On appeal, the Commissioner (Appeals) upheld the Asstt. Commissioner's decision, leading to the current appeal.

The appellant argued that there was no dispute regarding the receipt and use of the taxable services for payment of Service tax on output services. The appellant contended that denying the Cenvat credit based on the lack of registration of the service providers at the time of service provision, despite subsequent registration and payment of Service tax, was incorrect. The appellant challenged the Commissioner (Appeals)'s finding that registration is a fundamental requirement for allowing service tax credit on supplementary invoices. The appellant asserted that there was no legal provision supporting the denial of Cenvat credit in such circumstances.

The Department defended the impugned order, supporting the findings of the Commissioner (Appeals). Upon careful consideration of the submissions and records, the Tribunal found that the appellant had indeed received the taxable services from the service providers who were unregistered at the time of service provision. However, the service providers later obtained service tax registration and paid the Service tax under supplementary invoices. It was established that the input services were used for providing taxable output services. Therefore, the Tribunal held that denying the Cenvat credit based on the supplementary invoices was unjustified. The Tribunal concluded that since the receipt and use of input services were not in dispute, the credit of Service tax on the input services, even if paid subsequently under supplementary invoices, could not be refused. Consequently, the impugned order was set aside, and the appeal was allowed with consequential relief.

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