Cenvat Credit is always subjected to many queries, restrictions and ambiguities regarding its eligibility on both the legal and documentary (physical) end. In such a Scenario it becomes essential to understand the conceptual framework before establishing the eligibility of Proper Cenvat Document. This article discusses whether
- A Debit Note can be held as proper Cenvat Document?
- A multipage annexure debit note is a proper Cenvat Document?
Before going in the depths, it is imperative to brush the relevant legal structure of governing physical documents under Cenvat of Input Service.
As per Rule 4A of Service tax Rules, 1994, Every person providing taxable service shall not later than thirty days from the date of completion of such taxable service or receipt of any payment towards the value of such taxable service, whichever is earlier issue an invoice, a bill or, as the case may be, with following requirements :-
- It shall be serially numbered and shall contain following details,
- the name, address and the registration number of such person
- the name and address of the person receiving taxable service
- description and value of taxable service provided or agreed to be provided
- the service tax payable thereon
As per Rule 9(1)(f) of Cenvat Credit Rules,2004 an invoice, a bill or challan issued by a provider of input service on or after the 10th day of, September, 2004 shall be a valid documents for Cenvat.
In a Simplified reply to the above queries, it is held by the judgements that where the above particulars are duly disclosed on “any document (even if named as debit note)” the same shall envisage to be a proper cenvat document even if all the particulars are not disclosed on one page but as annexure to the main page of such debit note.
The above view is supported by several judgements.
In case of M/s. Jyoti Industries Unit-II Versus CCE & ST, Ludhiana 2013 (11) TMI 949 it has been held that :-
“The documents title debit notes/invoice and the same mentioned service tax registration number of the service provider, mentioned the nature of the service as Business Auxiliary Service and also the details of value of the taxable service and service tax paid - all the information which is required to be mentioned in invoice issued by the service provider is available in the documents and just because before the word invoice, the word debit note has been added, these documents would not cease to be a valid document for the purpose of cenvat credit”
In case of Atlas Documentary Facilitators Co Pvt Ltd Versus Commissioner Of Service Tax 2013 (12) TMI 440 it has been held that :-
“Purpose of prescribing a document for availment of credit is to enable the Revenue to verify the fact of payment of service tax by the service provider and the receipt and consumption of service by the service recipient in further provision of output service. The prescription of document is only a machinery provision for achieving the object of law. In the present case, Rule 4A of the Service Tax Rules, 1994 does not prescribe any format of document to be issued by the service-provider. It only specifies what are the particulars which should be contained in the document. These particulars are, namely and, address of the service provider, service tax registration number, name and address of the service recipient, description of the service rendered and the value thereof and the service tax paid. If this information is available in any document, the same would constitute a valid document for the purpose of availing CENVAT credit.”
In case of M/s Unique Pharmaceuticals Laboratories Versus CCE Surat-II 2013 (10) TMI 266 it has been held that :-
It is also an established law that CENVAT Credit cannot be denied merely on the basis of certain procedural lapses when the duty paid nature and its receipt in the factory and utilization in the manufacturing activity are not disputed
Hence where all the information contained and required to be mentioned on invoices is contained in the debit notes the same shall be valid cenvat documents. The same view is accepted in plethora of judgements, some of them are :-
- Misson pharma Logistics (I) P. Ltd. [2012 (11) TMI 117 - CESTAT, AHMEDABAD],
- Indore Vs. Gwalior Chemical Industries Ltd. [2012 (5) TMI 352 - CESTAT, NEW DELHI] and
- CCE, Nasik Vs. Graphite (I) Ltd. [2006 (10) TMI 224 - CESTAT, MUMBAI]
- M/s. Diamond Cements Versus CCE, Bhopal 2013 (5) TMI 243 - CESTAT NEW DELHI
Even where the particulars are mentioned not on the same page but as an annexure still the same shall be held as proper cenvat Documents as accepted in Hybrid Electronic Systems P. Ltd. vs. Commissioner of Central Excise, Mumbai - I 1996 (87) ELT 526 (Tribunal) wherein it has been held that if all the material particulars cannot be accommodated in one page of the invoice, there cannot be any objection in having annexure giving the particulars to the invoice.
Though in Godrej Consumer Products Ltd. vs. Commissioner of Central Excise, Indore 2010 (20) STR 609 (Tri.-Del.) wherein it has been held that denial of credit on the strength of debit notes cannot be regarded as incorrect in law.
Recently in case of Atlas Documentary Facilitators Co Pvt Ltd Versus Commissioner Of Service Tax 2013 (12) TMI 440 the Hon’ble CESTAT has accepted the view in case of Hybrid Electronic Systems P. Ltd. vs. Commissioner of Central Excise, Mumbai - I 1996 (87) ELT 526 (Tribunal) as against the view as held in case of Godrej Consumer Products Ltd. vs. Commissioner of Central Excise, Indore 2010 (20) STR 609 (Tri.-Del.)
About the Author:
CA Ankit Gulgulia
Author is Practicing Chartered Accountant in New Delhi/NCR and specialising in Indirect Taxes, Corporate Laws and Transfer Pricing. He can be reached at firstname.lastname@example.org / +91-9811653975
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