Hindustan Zinc Ltd. Vs Commissioner (Appeals), Central Excise & Central Goods And Service Tax (CESTAT Delhi)
The issue to be adjudicated herein is as to whether the Cenvat Credit availed of Service Tax paid is liable to be denied being availed on the following grounds:–
(i) Performa invoices
(ii) Invoices issued in the name of Head Office instead of factory unit;
(iii) Invoices issued by Rampal Sahu in contravention of Rule 9(1) of the Cenvat Credit Rules, 2004, and
(iv) Excess availment of Cenvat Credit on the invoice dated 28.6.2017 issued by Sandvik Asia.
Point wise findings are as follows:
(i) Cenvat Credit on Performa invoices:
The manufacturer or producer of final product or the provider of output service is eligible to take CENVAT Credit of the duty/ tax paid by him in terms of Rule 3 of Cenvat Credit Rules, 2004. Rule 9 thereof requires certain documents and accounts to be the basis for taking the Cenvat Credit. The said Rule of 9 of Cenvat Credit Rules, 2004 clarifies that Cenvat Credit on the documents as mentioned in Sub Rule (1) of Rule (9) shall be available if and only if all the particulars as prescribed under the respective statute are contained in the said documents. The conjoint reading of both the said Rules makes it clear that it is not merely a specific documents in sub rule but any similar document which may provide all the statutory particulars that the same shall be admissible for permitting availment of Cenvat Credit to the manufacture or service provider. Also the documents required under the Rule 9 are not confined to merely invoices but these may be any documents, like bill or challan as issued in terms of Rule 4 (2) A of the Service Tax Rules etc. This particular Rule specifies the amount of information as is required in a particular documents for availment of Cenvat Credit. Thus any documents as required under Rule 4(2)A can be the documents under Rule 9 of Cenvat Credit Rules for entitlement of availing Cenvat Credit. I draw my support from the decisions of this Tribunal in the case of CCE Indore vs Grasim Industries reported as [2011 (24) STR 691(Tri-Del)] and Emmes Metals Pvt Ltd. vs CCE, Appeal No. E/1015/2011 decided on 9.3.2016. There is no denial that entire information as required under Rule 9 was available in the performa invoices on which credit was availed by appellant. Hence, it is held that denial of availment of Cenvat Credit on performa invoices was absolutely wrong.
(ii) Invoices issued in the name of Head Office instead of factory unit
The availment of income tax credit is the creature of statute and the amounts to a substantial benefit which can not be denied based upon the some procedural irregularity. The Hon’ble High Court of Gujarat has allowed the Cenvat Credit even of zerox copy of the invoices holding that the Cenvat Credit cannot be denied on the basis of mere procedural irregularity. Hon’ble High Court of Punjab and Haryana in the case of Commissioner of Chandigarh vs Stelko Strips Ltd reported as [2010 (255) ELT 397 (P&H)] while relying upon the earlier decision in the case of CCE Ludhiana vs Ralson India Ltd. reported as [2006 (202) ELT 65 (P&H)]. The Commr. of C. Ex., Delhi- III, Gurgaon vs Myron Electricals Pvt. Ltd. reported as [2008 (11) STR 85 (P&H)] has held that the credit cannot be denied on the ground that the documents did not contain all the particulars. It was clarified that once difference was disputed and it was found that documents were genuine and not fraudulent then the manufacturer would be entitled to take Cenvat Credit on duty paid invoices. Issuance of invoices in the name of head office is merely procedural compliance. Credit based on such invoices is therefore held available. Findings to this aspect in Order-in-Appeal are liable to be set aside.
(iii) Invoices issued by Rampal Sahu in contravention of Rule 9(1) of the Cenvat Credit Rules, 2004,
The invoices as annexed on the record are perused. Perusal thereof clarifies that the services mentioned in such invoices is that of hiring of cranes none of the invoices is mentioning any service as that of food facility for police guards to have been availed is found on record. The order under challenge is silent about any such specific invoice. Whatever invoices has been mentioned in the order under challenge are mentioning the nature of service of hiring charges of cranes. Another ground for denying the credit based on these invoices is the difference of PAN Card No. of Rampal Sahu. The appellant has mentioned that there had occurred the typographical error on the invoice in question, that too only of one letter i.e. S instead of H (PAN No. of Rampal Sahu BYYPS 8713 H). Copy of PAN is placed on record by the adjudicating authority. Accordingly, non consideration of the said submission despite the documents being on record is held to be highly irrational and unjustified on the part of the adjudicating authority. It is held that the credit on this ground has also wrongly been denied.
(iv) Excess availment of Cenvat Credit on the invoice dated 28.6.2017 issued by Sandvik Asia
Coming to the issue of excess availment of Cenvat Credit on invoices dated 28.6.2017 issued by Sandvik Asia, it is observed that the appellant had demonstrated that there were two different separate invoices on which credit was taken as follows:
