Order date – 19 October 2022

 Facts –

• The appellant, Srini Link, is a service recipient and paid the service tax in respect of services received from service provider whereas, the service tax liability statutorily was on the service provider. The appellant have taken the cenvat credit in respect of such service tax paid by them under reverse charge mechanism on the strength of bank challan whereby, the service tax was deposited.
• The cenvat credit was denied to the appellant on the ground that the service tax was paid by the appellant as a recipient and the challan through which the appellant have paid the service tax is not a valid document for availing the cenvat credit. 
• Aggrieved, Revenue has filed an appeal.

Issue – 

• Whether the denial of cenvat credit is in order? 

Order – 

• The Tribunal found that there is no specific condition in the Cenvat Credit Rules that Cenvat credit can be allowed only when Service tax is paid by the service provider. The fact is not under dispute that the appellant has received the services which suffered service tax, and the government exchequer has received the service tax amount. In such case the compliance of the Cenvat Credit Rules stand fulfilled therefore, on the ground that the appellant have paid the service tax therefore the credit is not available is absolutely incorrect. 
• It is clearly held in many judgments that the challan through which the service tax was paid is a valid document for availing the cenvat credit therefore, for this reason also the cenvat credit cannot be denied. Accordingly, the department’s allegation clearly fails on both the grounds.
• Hence the appellant have rightly availed the cenvat credit in respect of service tax paid by them on receipt and use of service.
• The impugned order is set aside. Appeal is allowed.