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August 2013

2013 (30) S.T.R. 475 (Tri-Bang.) Mangalore Refinery & Petrochemicals vs. Commissioner of Central Excise, Mangalore.

By Puloma Dalal, Jayesh Gogri, Chartered Accountants
Reading Time 1 mins
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Without ISD registration, CENVAT credit cannot be transferred.
Facts:
The appellant had a registered office at Mumbai which transferred the input credit to its manufacturing unit at Mangalore sans registration as an Input Service Distributor (ISD) and department denied the same as Mumbai office was not registered as ISD. The Appellant submitted that this was a minor defect and as such, the substantive benefit of CENVAT should be allowed.

Held:
The Tribunal observed that since there was a specific provision to take ISD registration for the purpose of distributing CENVAT credit on any input service received by a manufacturing unit or an output service providing unit under cover of invoice/bills/challans issued by the input service provider, to its own manufacturing unit or output service providing unit, it was not permissible to distribute CENVAT credit by the Mumbai office to its Mangalore unit without obtaining ISD registration and issuing invoices in terms of sub-rule (2) of Rule 4A of the Service Tax Rules, 1994.
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