Custom, Excise & Service Tax Tribunal
Yes vs Represented By : Shri S.K. Mall, A.R on 29 January, 2013
CUSTOMS EXCISE & SERVICE TAX APPELLATE TRIBUNAL, West Zonal Bench, Ahmedabad COURT-II Appeal No.ST/610/11 Arising out of OIA No.170/2011(STC)/K.ANPAZHAKAN/Commr.(A)/Ahd, dt.19.07.11 Passed by Commissioner of Service Tax (Appeals), Ahmedabad For approval and signature : Hon'ble Mr. M.V. Ravindran, Member (Judicial) 1 Whether Press Reporter may be allowed to see the Order for publication as per Rule 27 of the CESTAT (Procedure) Rules, 1982? No 2 Whether it should be released under Rule 27 of CESTAT (Procedure) Rules, 1982 for publication in any authoritative report or not? No 3 Whether their Lordships wish to see the fair copy of the Order? Seen 4 Whether Order is to be circulated to the Departmental authorities? Yes Appellant (s) : CST Ahmedabad Represented by : Shri S.K. Mall, A.R. Respondent (s) : M/s. Lambda Therapeutic Research Ltd.
Represented by : Shri Dhaval Shah, Adv CORAM :
Hon'ble Mr. M.V. Ravindran, Member (Judicial) Date of Hearing/Decision : 29.01.13 ORDER No. _____________ /WZB/AHD/2013 Per : Mr. M.V. Ravindran;
This appeal is directed against order in appeal No.170/2011(STC)/K.ANPAZHAKAN/Commr.(A)/Ahd, dt.19.07.11.
2. The brief facts of the case are that the respondents are engaged in providing taxable services covered under the definition of TIC, STC, MRS and holding Service Tax Registration No. AAACL4081RST001. During the course of CEM Audit, it was observed by the audit party that for the year 2004-05 to 2007-08, the respondents had availed Cenvat credit of Service Tax amounting to Rs.2,83,535/- on rent-a-cab operator's service, mandapkeeper's service, decorator's service, staff welfare expenses and interior designer's services. The availment of Cenvat credit on such input service was irregular since the above services were not covered under specific categories of input services under Cenvat Credit Rules, 2004. This had resulted in incorrect availment of Cenvat credit of Rs.2,83,535/-. Thus, it was observed that the respondents had contravened the provisions of the Cenvat Credit Rules, 2004 and wrongly availed and utilized Cenvat credit of Service Tax amounting to Rs.2,83,535/-. A show cause notice dated 06.10.2009 was, thus, issued to the respondents which was adjudicated vide the impugned order. The adjudicating authority has disallowed the wrongly availed Cenvat credit amounting to Rs.2,83,535/- and ordered for recovery of the same under Section 73(1) of the Finance Act, 1994 read with Rule 14 of Cenvat Credit Rules, 2004. He directed the respondents to pay the interest at prescribed rate under Section 75 of the Act and also imposed penalty under Rule 15(2) of Cenvat Credit Rules, 2004.
3. Aggrieved by such an order, the assessee preferred an appeal before the first appellate authority raising various points. The first appellate authority after following the due process of law and following the decisions of this Tribunal in the case of Mundra Port & Special Economic Zone, set aside impugned order and allowed the appeal of the assessee. Revenue is aggrieved by such an order and is before the Tribunal.
4. The ld. Additional Commissioner (A.R.) would submit that the order passed by the first appellate authority is incorrect and erroneous in law in as much as he has not considered the definition of input service as enshrine under Rule 2(l) of the Cenvat Credit Rules, 2004. He would refer to the said rules and submit that the credit availed by the assessee on the various input services i.e. rent a cab operator service, mandapkeeper's service, decorator's service, staff welfare expenses and interior designer's services are improperly availed. It is his submission that the reliance placed by the first appellate authority on the judgment of Honble High Court of Bombay in the case of Ultratech Cement Ltd. 2010 (20) S.T.R. 577 (Bom.) is also not correct as it has been deported by the various decisions of the Tribunal. He would submit that the judgment of Honble High Court of Bombay in the case of Manikgarh Cement 2010 (20 STR 456 (Bom.) will apply. It is also the submission that the first appellate authority has erred in allowing the cenvat credit only on the ground that the assessee had a centralised service tax registration certificate. It is his submission that said registration certificate clearly shows the address of the business of the branches and service provider while the fact that the registration certificate was amended by the service provider on 21.11.07 whereas the period covered in the show cause notice is for 2004-05 to 2007-08. Hence the certificate which has been amended showing the name of the assessees unit in this appeal only covers from third in question.
5. Ld. counsel appearing on behalf of the appellant would support the order in appeal. He would submit that as regards the cenvat credit with the service tax paid by rent a cab operator service, there are various decisions of this bench and the recent one being as reported at 2010-TIOL-711-CESTAT-MAD and Semco Electrical Pvt. Ltd. - 2010 (18) S.T.R. 177 (Tri. - Mumbai). It is also his submission that the decision of the Tribunal in the case of Stanzen Toyotetsu India Pvt Ltd. 2010-TIOL-1454-CESTAT-BANG is also on the issue and it has been upheld by the Honble High Court of Karnataka. It is his submission that as regards the mandapkeeper's service, the issue is also settled in the judgment of the Tribunal in the case of Toyota Kirloskar Motor P. Ltd. 2008 (12) S.T.R. 498 (Tri. - Bang.) and Heg Ltd. 2011 (24) S.T.R. 275 (Chhattisgarh). It is his submission that various decisions of the Tribunal squarely cover the eligibility to cenvat credit of the service tax paid by various service providers as the same are related to the activities of the business of the assessee. It is also his submission that the points raised by the ld. A.R. as regards the name and address of the appellant being subsequently changed will not also be of much effect as long as there is an eligibility to avail cenvat credit and there is no dispute as to the discharge of service tax liability by the service provider, an assessee should not be precluded from taking the cenvat credit.
6. I have considered the submissions made at length by both sides and perused the records.
7. The issue involved in this case is only regarding the cenvat credit of the service tax paid on rent a cab operator service, mandapkeeper's service, decorator's service, staff welfare expenses and interior designer's services.
8. It is undisputed that the appellant herein is providing taxable output service covered under the definition of technical inspection certificate, maintenance and repair services. It is also undisputed that the respondent has paid the amount of service tax charged by various service providers to him, are for his activities of the business. The first appellate authority has clearly recorded the services utilised of various service providers as regards rent a cab operator service, mandapkeeper's service, decorator's service, staff welfare expenses and interior designer's services and had come to a conclusion that the said input services are used in or in relation for provision of output services, by the respondent. The confirmation made by the ld. Additional Commissioner (A.R.) that there has to be a nexus of the utilisation of such services for providing on output service, is in my view not in consonance with the law which has been settled as to there is no one to correlation, of the cenvat credit availed. The same ratio will be applicable in this case also.
9. As correctly pointed out by the ld. counsel, the various decisions cited by him are in favour of the assessee, accordingly I find that the impugned order of the first appellate authority is correct in setting aside the order in original.
10. Another ground of appeal it was raised by the Revenue is regarding the address of the assessee not being mentioned on the invoices on which credit was availed. I find that there is no dispute that the assessee had received such input services and has utilised the same for providing taxable output services. It is also not in dispute that the assessee has registered himself on a common address for providing the output service. In my view, the fact that there is no dispute as to receipt of the services and utilisation of the same by the assessee, even this points raised by the Revenue will not carry their case any further.
11. In view of the foregoing, I find that the impugned order is correct and legal and does not suffer from any infirmity.
12. The impugned order is upheld and the appeal is rejected.
(Operative Portion Pronounced in the Court) (M.V. Ravindran) Member (Judicial) .JK 6