Indo Alusys Industries Ltd. Vs Commissioner of Central Goods and Service Tax (CESTAT Delhi)
CESTAT Delhi held that once the services in question have already been settled to be the eligible input services, the Cenvat credit thereof cannot be denied to the assessee.
Facts- Two show cause notices, alleged that M/s. IAIL, Bhiwadi had wrongly availed Cenvat credit of Rs.53,58,845/- during November 2006 to June 2009 and Rs.23,73,986/- during the period August 2009 to June 2010 on the strength of irregular input service distribution invoices. Appellants were also alleged to have utilized the said irregular credit for payment of central excise duty payable on clearance of their final products which resulted into short payment of duty to the extent of the use of said irregular input service credit. The various services mentioned in both the show cause notices are erection, commission & installation service; advertisement service; clearing & forwarding services; etc.
Conclusion- We hold that the adjudicating authority below has not observed the judicial protocol while denying credit on the ground that the services are not eligible Input Services. Once the services in question have already been settled to be the eligible input services, the Cenvat credit thereof cannot be denied to the assessee. There remains no necessity to invoke Rule 9(6) of Cenvat Credit Rules, 2004. Hence, we hold that the adjudicating authority has wrongly held the impugned services to be ineligible input services while disallowing the Cenvat credit of the service tax paid on the said services.
We hold that the adjudicating authority below has failed to appreciate the catena of decisions not only of this Tribunal but also of their own department with respect to the impugned services and even with the decisions passed by departmental authorities in favour of the present appellant themselves permitting them to avail Cenvat credit distributed by their ISD. The order under challenge is therefore hereby set aside. Consequent thereto, the appeal stands allowed.
FULL TEXT OF THE CESTAT DELHI ORDER
Present appeal has been filed to assail the Order-in-Original No. 26-27/17-18 dated 11.12.2017 vide which the Cenvat credit as was distributed by the appellant’s Input Service Credit Distributor (ISD) has been disallowed. Denial of Cenvat credit was proposed vide two separate show cause notices as mentioned below:
