Service Tax
TRT-2025-
Cestat Kolkata
Date:-10-08-22
In:-
Issue Favourable to Tax Payer ?:- 0
Order Date: 10 August 2022
Facts-
- The Appellant, Visa Resources India Limited, filed an appeal against the Order passed by the First Appellate Authority covering the period from April 2010 to March 2013 by which a demand of Cenvat Credit and Service tax has been confirmed along with interest and imposition of penalty.
- The Department contended that debit notes are not valid documents for availment of Cenvat credit of Service Tax and thus had disallowed the same availed by the Appellant on debit notes issued by Visa Infrastructure Ltd. for ‘business support’ and ‘management consultancy services’.
- A Show Cause Notice was issued by the Department which came to be adjudicated wherein the demand as proposed in the SCN was confirmed along with interest and penalty.
Issue-
- Whether Cenvat credit of Service tax can be availed on debit notes under the scheme of the Cenvat Credit Rules 2004?
Order-
- The Tribunal observed that as per clause (f) of Rule 9 of the Cenvat Credit Rules, 2004, an invoice issued by a provider of input service is a valid document for availment of Cenvat credit - In the present case of the Appellant, the heading of the document are nomenclated as debit notes but they contain all the disclosures as required in a tax invoice as per Rule 4A of the Service tax Rules, 1994.
- Further it is not in dispute that the services have not been consumed/utilised by the Appellant and no such allegation had been made out in the SCN issued, hence Cenvat credit cannot be denied to the Appellants. Thus the appeal succeeds to that extent and the demand is quashed.
- The Tribunal held that as regards service tax liability under RCM, since the amount has been paid with interest before issuance of the SCN itself, no penalty under section 78 can be imposed in the appellant, being a settled jurisprudence.
- Thus, the appeal is allowed.
Download Case Law
