By TIOL News Service

MUMBAI, JAN 17, 2016: THE appellant availed Cenvat Credit of Rs.13,69,842/- on the strength of Input service invoices which were invoiced not in the name of the appellant but to the Divisions of L&T other than Heavy Engineering Division (HED).

Alleging that the credit had been wrongly availed, a demand was issued for its recovery and the adjudicating authority confirmed the same and imposed equal penalty with interest.

The Commissioner (Appeals) upheld this order and, therefore, the appellant is before the CESTAT.

We reported the stay order as 2014-TIOL-1187-CESTAT-MUM.

The appeal was heard recently.

The appellant explained that since the services were provided in the premises of the job worker but for job work of the appellant and in relation to the manufacturing process carried out by the job worker on behalf of the appellant, services were received by the appellant; that even though the name of the job worker is appearing on the invoices which are because services were provided in the premises of the job worker, however the name of the appellant is clearly appearing on the service tax invoices; that the services were received by the appellant, payment of such service bills were made by the appellant to the service provider directly, so recipient of the services are the appellant and merely because the job worker name appears on the invoices of the service provider that should not be the reason for denial of Cenvat Credit. Reliance is placed on the decisions in Gujarat Heavy Chemicals Ltd. 2005-TIOL-641-CESTAT-MUM, Kalpana Industries 2003-TIOL-301-CESTAT-MUM& Endurance Technologies Pvt Ltd. 2011-TIOL-1045-CESTAT-MUM.

The AR submitted that though the invoices bear the name of the appellant the services were provided in the premises of job worker and, therefore, the order passed by the lower authorities is proper in law.

The Bench observed -

+ The whole case is revolving only on the aspect that invoices of services are not bearing the address of the appellant. However, the name of the appellant is indeed mentioned in the invoices. I think on that basis alone it was wrongly concluded by the lower authority that in absence of address it cannot be ascertained that the services provided and covered under the input services invoices were meant for the appellant.

+ As per the submission of the appellant which they have been making before both lower authorities that R&C Ltd. is job worker of the appellant and in relation to the job work carried out by the job worker the said service were provided by the service provider in the premises of the job worker on behalf of the appellant. Since, undisputedly the job worker is carrying out job work of the appellant goods, therefore it cannot be presumed that service is provided by the service provider is not for and on behalf of the appellant.

+ If there is doubt about service recipient due to reason that address of the appellant is not appearing on the invoices, by corroboration of the books of account and payment particulars made against the said invoices, it can be ascertained that service recipient is the appellant and nobody else.

+ However these facts of accounting of bills in the books of account of the appellant and accounting of payment made by the appellant to the service recipient were not verified by the lower authority.… the matter deserves to be remanded to the original authority for this limited purpose.

The appeal was allowed by way of remand.

(See 2016-TIOL-177-CESTAT-MUM)