CENVAT credit admissibility on input services upheld; overlapping proceedings and time-barred notice defeated the demand and penalty.

CENVAT credit on the disputed input services was admissible because the services were substantially received before April 2011, when the wider pre-amendment definition of input services applied, and they were also covered under the post-April 2011 definition. The demand was additionally found unsustainable because it overlapped with another proceeding for the same financial year and was inconsistent with the earlier final order in the connected matter. The notice proposing denial of credit for 2011-12 was also held time-barred. On these grounds, the credit was allowed and the demand and penalty were set aside in favour of the assessee.

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Issues: Whether the disputed CENVAT credit on input services was admissible and whether the demand and penalty could be sustained.

Analysis: The disputed services were substantially received before April 2011, and the credit related to the period when the wider pre-amendment definition of input services applied. The order also noted that the services were otherwise covered even under the post-April 2011 definition. The demand was further found unsustainable because it overlapped with another set of proceedings for the same financial year and was not consistent with the earlier final order in the connected matter. The Tribunal also accepted the plea that the notice proposing denial of credit for the 2011-12 period was issued beyond time.

Conclusion: The disputed credit was held admissible, and the demand as well as the penalty were set aside in favour of the assessee.

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