Different Addresses, Registration Of Premises Not Pre Condition For Availing Cenvat Credit: CESTAT

The Mumbai Bench of Customs, Excise, and Service Tax Appellate Tribunal (CESTAT) has held that the registration of premises is not a condition precedent for availing cenvat credit.

The bench of Suvendu Kumar Pati (Judicial Member) and Anil G. Shakkarwar (Technical Member) has observed that there is no allegation in the show cause notice that the services associated with the invoices in question were not received by the appellant nor were there any allegations that the input services did not suffer service tax. The appellant/assessee was eligible for availment of CENVAT credit.

The appellant/assessee is engaged in selling software products developed by Microsoft, which come in the form of e-licenses.

The appellant has registered with Service Tax for their business premises. The appellant has been availing of the facility of CENVAT credit. During the scrutiny of records of the appellant for the period from 2010-11 to 2013-14, it was observed that the invoices of input services were having addresses of the recipient of service as 227, Near Shivaji Skating Ground, Gandhi Nagar, Nagpur, as well as 286, Mata Mandir Road, Dharampeth, Nagpur, and Semee Compound, Mahoba Bazar, Behind Picaddly Hotel, Raipur.

The department observed that the input services where the address is other than that for which registration was obtained were not admissible for availability for cenvat credit in terms of proviso Rule 9(2) of Cenvat Credit Rules, 2004. Therefore, a show cause notice was issued to the appellant with a proposal to disallow cenvat credit under proviso to Section 73(1) of the Finance Act, 1994, read with Rule 14 of the Cenvat Credit Rules, 2004. There were other proposals for imposition of penalties and recovery of interest. Appellant contested the show cause notice and submitted that they were registered for service tax at their address at 227, Near Shivaji Skating Ground, Gandhi Nagar, Shankar Nagar, Nagpur, and when the business increased, they shifted and started running their business from two places having addresses of 286, Mata Mandir Road, Dharampeth, Nagpur, and Semee Compound, Mahoba Bazar, Behind Picaddly Hotel, Raipur, and they failed to take centralized service tax registration to include those two addresses in service tax registration.

The assessee contended that there were a plethora of judgments that held that cenvat credit cannot be denied merely due to technical lapses like non-registration of premises or mentioning of wrong addresses on cenvat documents if there is no dispute with respect to use of input services in relation to providing output services.

The show cause notice was adjudicated, and the department held that the invoices that were received having addresses other than the address of registered premises are the ones that could amount to not having received such services by the appellant. Therefore, the department disallowed cenvat credit of Rs. 1,19,19,010 and imposed an equal penalty and ordered the appellant to pay interest.

The tribunal held that it is well settled law that registration of premises is not mandated as a condition precedent for availment of cenvat credit and there is no provision in Cenvat Credit Rules that imposes such a restriction, and that it has been held in a number of decisions that cenvat credit cannot be denied on the basis of the allegation that the output service provider had issued invoices mentioning the addresses of unregistered offices of the service receiver.

The tribunal, while allowing the assessee's appeal, held that the assessee was eligible for availment of cenvat credit of Rs. 1,19,19,010.

Counsel For Petitioner: Mayur Shroff

Counsel For Respondent: S.B.P. Sinha

Case Title: Shreyas Infotech Versus Commissioner of CGST

Case No.: Service Tax Appeal No. 87648 of 2016

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