Case Law Details
VAX Paper Chemicals Ltd Vs Commissioner of Central Tax Visakhapatnam (CESTAT Hyderabad)
Held that the Hyderabad office is not required to act as an input service distributor (ISD) as there is no head office-branch office basis relation between the Hyderabad office and other offices. Accordingly procedure under Rule 4A of the Services Tax Rules, 1994 not required to be followed.
Facts- In the course of audit and scrutiny of records of the appellant it was observed that they had availed “input service” tax credit on the basis of invoices and bank payment vouchers issued in the name of their head office.
Further verification revealed that the appellants are having units located at Gumpam, Kathua and Kovai and that the expenses pertaining to two or more units have been incurred by their head office and entire service tax involved therein is completely passed on to the assessee located at Gumpam only.
Further, on verification of such Debit Advice/Invoices issued in the name of Head Office at Hyderabad the actual usage of services involved therein could not be co-related with their unit located at Gumpam and hence the nexus between the invoices and utilisation of input service tax credit could not be established.
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