Rajasthan Housing Board Vs Commissioner (Appeals) (CESTAT Delhi)
The Delhi CESTAT allowed both appeals filed by Rajasthan Housing Board against orders upholding denial of CENVAT credit availed on running account bills. The appellant was engaged in rendering and receiving taxable services, including construction, transportation, renting of immovable property and other taxable services. During audit, the Department alleged that CENVAT credit had been availed without proper documents prescribed under Rule 9(1) of the CENVAT Credit Rules, 2004.
Two show cause notices dated 18.07.2019 and 04.08.2019 covered the periods 01.10.2013 to 31.03.2014 and 01.04.2014 to 30.06.2017, respectively. The notices proposed recovery of CENVAT credit of ₹55,57,792 and ₹55,93,529. The Department alleged that the credit was based on running account bills showing measurements of work and amounts payable to contractors, which allegedly did not contain mandatory particulars under Rule 9(1). It was also alleged that the appellant had not produced documentary evidence supporting the credit. The adjudicating authority disallowed the credit and ordered recovery with interest and penalty under Rule 15 of the CENVAT Credit Rules, 2004. The Commissioner (Appeals) rejected the appellant’s appeal.
Before the Tribunal, the appellant submitted that the bills were prepared by contractors and verified by the appellant’s designated personnel with reference to measurement books, rather than being prepared by the appellant’s engineers. It also submitted that service tax had been paid under reverse charge and CENVAT credit was taken after payment of the tax. According to the appellant, the contractor bills satisfied the requirements of Rule 4A of the Service Tax Rules, 1994 and Rules 9(1) and 9(2) of the CENVAT Credit Rules, 2004.
