TaxTMI 
TaxTMI 
2021 (9) TMI 688
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....uts and input services. They availed input service credit on debit notes raised for cost sharing by M/s. Gates India Pvt. Ltd. (GI) which along with the appellant are a subsidiary of Gates Corporation, USA. They had a common corporate office at Gurgaon and had entered into a cost sharing and reimbursement agreement by which both the parties intended to share various office and administrative costs and the appellant reimburses the charges incurred in terms of the agreement. The allegation is M/s. Gates India Pvt. Ltd. raised debit notes on the appellant on monthly basis for cost sharing without details of service received but only showing the payment of service tax at applicable rates. The appellant availed CENVAT credit on such debit notes.....
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....other administrative services. It is argued by him that it is prevalent practice in the industry that group of companies under common ownership rent/lease a common building and avail services commonly for achieving efficiencies in operation such as office space, advertising, home resources, security services, banking, financial and insurance service. Under such agreement, one of the companies will make payments for lease, rent, electricity charges and other administrative charges which are the common service that are shared by them and these expenses are then shared between the group of companies in an agreed manner. The appellant has thus entered into cost sharing and reimbursement agreement dated 1.4.2012. On the basis of this agreement, ....
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.... paid by the service provider is not in dispute, the assessment to tax at the hands of the service provider cannot be disputed or denied at the end of the service recipient. 5. With regard to the issue of availment credit on debit notes, the ld. Counsel submitted that in the case of Shree Cement Ltd. Vs. CCE, Jaipur - 2013 (29) STR 77 (Tri. Del.) it was held that CENVAT credit cannot be denied when the credit is availed on debit notes if such note contains all the mandatory particulars as prescribed in the Service Tax Rules. That there is no scope to deny the credit when the service tax has been actually deposited in the Government. He prayed that the appeal may be allowed. 6. The ld. AR Ms. T. Sridevi supported the findings in the im....
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....e nature of transactions done by the assessees with BIL. 14. The BSNL/Reliance Communications Pvt. Ltd. have provided the MPLS facility to BIL and assuming the amount to be paid is Rs. 100/- towards the cost and Rs. 10/- towards the service tax, when the invoice is raised by the BSNL/Reliance Communication Pvt. Ltd. For the said amount and the BIL has paid Rs. 110/- to BSNL/Reliance Communication Pvt. Ltd. which includes the cost as well as Service Tax element, the BIL, in turn, has raised an invoice on the assessees claiming proportionately the costs which they have incurred to BSNL / Reliance. By way of illustration, if Rs. 20/- has been passed on to one of the assessees, a sum of Rs. 2/- is collected as service tax and each of t....
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....e tax component which was collected from the assessees by BIL was only the amount on which the CENVAT credit has been claimed by the assessees. Therefore, unless and until the assessment made on BIL was revised, which obviously could have been done, at this juncture, on account of the expiry of the period of limitation, the interpretation given by the Commissioner (Appeals) as well as the Tribunal with regard to the nature of invoice raised on the assessees is unsustainable. Furthermore, we find that the reason assigned by the Tribunal in para 6.2 stating that the activity performed by the BIL for monitoring of production activities of the assessees cannot by any stretch of imagination be considered as an input service or in relation to the....
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..... 10. It is evident from the facts that the department does not dispute the payment of service tax on the amounts raised in the debit notes. The Show Cause Notice is issued only to the service recipient (appellant herein) who has availed the credit of service tax collected via the debit notes. If the department holds that the payment of service tax is legal and proper, then the credit availed on the tax cannot be denied alleging that no service is provided. 11. Further on the issue whether debit notes are valid documents to avail credit, it has to be stated that though Rule 9(1) of CENVAT Credit Rules, 2004 does not mention debit note as a document on which credit can be availed, when all necessary particulars are mentioned the credit....