Service - Cestat Mumbai: Appellant not having centralized registration, but having centralised accounting system at one place can avail Cenvat credits of input invoices received at unregistered premises – Appeal allowed (Order attached)
Order date: 07 October 2022
- The appellant, Desai and Diwanji, a law firm having branches in Mumbai and Delhi. The appellant was availing CENVAT Credit on inputs services received at both Mumbai and Delhi Branch Offices without centralised Registration.
- A show-cause notice was issued by the Respondent Department for reversal of CENVAT Credit of Rs.21,91,454 which they availed in respect of unregistered Delhi office for providing service from Delhi. Service Tax along with interest and penalty were imposed against the appellant.
- The appellant submitted that show-cause notice was issued for reversal of credit under Rule 14 of the CENVAT Credit Rules for contravention of Rule 4 of the CENVAT Credit Rules, 2004, without specific mention of which sub-Rule of Rule 4 was violated.
- Whether main branch can avail CENVAT credit of its unregistered branch?
- The Tribunal relied one of the identical case of Manipal Advertising Services Pvt. Ltd – Tribunal Bangalore, wherein the assessee having centralised accounting system at one place availed CENVAT Credits on invoices addressed to other premises also. It was held in that decision that in the event of centralised billing and centralised accounting system, when one registration is permissible under Section 4(2), discharging Service Tax liability from the registered premises would not disentitled the benefits of CENVAT Credit on the Service Tax paid by the service provider if invoices are raised in the name of Branch offices, even if the said Branch offices are unregistered one since Service Tax liability has been discharged by the main office also for service provided by the Branches.
- Hence, the denial of CENVAT Credits to the Appellant for input services availed by branch office at Delhi is set aside and appeal is allowed.