Custom, Excise & Service Tax Tribunal
M/S. Everest Industries Ltd vs Cce, Coimbatore on 13 September, 2013
IN THE CUSTOMS, EXCISE & SERVICE TAX
APPELLATE TRIBUNAL
SOUTH ZONAL BENCH, CHENNAI
Appeal No. E/495/2012
(Arising out of Order-in-Appeal No. 170/2012 dated 31.8.2012 passed by the Commissioner of Customs, Central Excise and Service Tax (Appeals), Coimbatore)
For approval and signature:
Honble Shri P.K. Das, Judicial Member
1. Whether Press Reporters may be allowed to see the Order for Publication as per Rule 27 of the CESTAT (Procedure) Rules, 1982?
2. Whether it should be released under Rule 27 of the CESTAT (Procedure) Rules, 1982 for publication in any authoritative report or not?
3. Whether the Members wish to see the fair copy of the Order?
4. Whether Order is to be circulated to the Departmental authorities?
M/s. Everest Industries Ltd. Appellant
Vs.
CCE, Coimbatore Respondent
Appearance Shri M. Saravanan, Chartered Accountant, for the Appellant Shri P. Arul, Superintendent (AR) for the Respondent CORAM Honble Shri P.K. Das, Judicial Member Date of Hearing: 13.09.2013 Date of Decision: 13.09.2013 Final Order No. 40435/2013 The appellant is engaged in the manufacture of Asbestos Cement Sheets classifiable under sub-heading No. 6811 40 10 of the Schedule to the CETA, 1985. They availed CENVAT credit on input services under CENVAT Credit Rules, 2004. By a show-cause notice dated 16.9.2010, it was proposed to deny CENVAT credit of Rs.5,64,314/- along with interest and penalty for the period April 2008 to December 2008 mainly on the ground that they had availed input service credit on the basis of debit notes raised by CHA namely M/s. Peirce & Leslie Agencies Ltd, which is not the valid document under Rule 91 of CENVAT Credit Rules, 2004. The original authority confirmed the demand of duty along with interest and imposed penalty. Commissioner (Appeals) upheld the adjudication order.
2. The learned counsel on behalf of the appellant submits that there is an allegation in the show-cause notice that CHA service is not an input service and the credit cannot be taken on the basis of debit notes. He submits that the original authority accepted that the appellant is eligible to avail credit on CHA services. But it was denied on the ground that they have availed credit on the basis of debit notes which is not within Rule 9(1) of the CENVAT Credit Rules, 2004. He submits that Rule 9(1)(g) provides an invoice, bill or challan can be issued by an input service distributor under Rule 4A of the Service Tax Rules, 1994. He submits that the debit notes fulfilled all the requirements of Rule 4A(1) of Service Tax Rules, 1994. He further placed the certificate dated 11.4.2013 issued by the CHA certifying that they had paid the service tax collected from Everest Industries Ltd. Coimbatore against which debit notes were issued. He also placed copy of the debit notes. He relied on the following decisions of the Tribunal:-
(a) CCE, Indore Vs. Grasim Industries Ltd. - 2011 (24) STR 691
(b) Pharmalab Process Equipments Pvt. Ltd. Vs. CCE, Ahmedabad - 2009 (242) ELT 467
(c) CCE, Indore Vs. Gwalior Chemicals Industries Ltd. - 2011 (274) ELT 97
(d) Shree Cement Ltd. Vs. CCE, Jaipur II - 2013 (29) ELT 77
(e) Mission Pharma Logistics (I) Pvt. Ltd. Vs. CCE, Rajkot - 2012 (27) STR 60 The learned counsel also submits that the Commissioner (Appeals) had not given any finding on the limitation as well as on imposition of penalty.
3. The learned AR on behalf of the Revenue submits that Rule 9(1) provides that CENVAT credit shall be taken by the manufacturer on the basis of the documents as specified therein. He submits that debit note is not a specified document under Rule 9(1) of the CENVAT Credit Rules, 2004. He further submits that the appellant availed the credit on the basis of the invoice issued by the CHA and in some cases they have availed credit on the basis of the debit notes issued by the same CHA. He submits that the Commissioner (Appeals) has rightly observed that the appellants have failed to establish that the debit notes issued were issued in general or for this particular appellant. He relied upon the decision of the Tribunal in the case of Universal Chemicals Industries Pvt. Ltd. CCE, Mumbai 2004 (177) ELT 726.
4. The learned AR submits that the original authority had given a finding that extended period of limitation would be invocable in the facts and circumstances of the case. He relied upon the decision of the Honble Supreme Court in the case of Collector of Central Excise Vs. Doaba Cooperative Sugar Mills 1988 (37) ELT 478 (SC).
5. After hearing both sides and on perusal of the records, I find that Rule 4A of Service Tax Rules, 1944 provides that the taxable service to be provided or credit to be distributed on invoices, bill, challan. It has also prescribed that such invoices, bill or challan or as the case may be, shall be serially numbered and shall contain the name, address and the registration number of such person and other informations as specified therein. It appears that the debit notes placed by the learned counsel and that the debit notes issued by the service provider had fulfilled all the conditions as prescribed under Rule 4A(1) of the Service Tax Rules, 1944. The Tribunal in a series of decisions, as referred by the learned counsel, held that debit notes issued by the service provider can be treated as document for availing credit. It is seen from the impugned order that the Commissioner (Appeals) observed that the appellant had not established as to whether this is the form in which the service provider issues debit notes in general or it is only for this particular appellant. In this context, the learned counsel placed the certificate dated 11.4.2013 issued by the CHA. He fairly submits that this issue was not in the show-cause notice and in the adjudication order and therefore he is placing this evidence before the Tribunal. In my considered view, there is no reason to deny the credit on the basis of the debit notes subject to verification of the documents placed by the learned counsel.
6. The learned AR relied upon the decision of the Universal Chemicals Industries (supra), which is not applicable in the present case. In that case, the issue was whether the credit would be admissible on the strength of cash memos.
7. In view of the above discussion and after considering the various decisions of the Tribunal, I set aside the impugned orders and remand the matter to the original authority to decide the matter afresh after considering the submission of the learned counsel and the decisions of the Tribunal as referred to by the learned counsel and the evidence. He shall also consider the issue of limitation and imposition of penalty.
8. The appeal is allowed by way of remand. It is made clear that the original authority shall examine all the issues and give adequate opportunity to the appellant for being heard.
(Dictated and pronounced in open court) (P.K. Das) Judicial Member Rex 2