The Ahmedabad bench of the Customs, Excise & Service Tax Appellate Tribunal ( CESTAT ) has held that Cenvat credit can be availed only on proportionate use while renting immovable property.
Deloitte Haskins & Sells, the appellant challenged the issue about the availment of Cenvat credit on renting of immovable property service in respect of the invoices of M/s Sabien Trusts for office No. 202, Heritage, Ashram Road, Ahmedabad, and for rent invoices of Mr. Raj Bhikhubhai Shah for office No.602, Heritage, Ashram Road, Ahmedabad. In the case of office No. 202 the credit has been denied on the ground that the said offices are not registered with the Service Tax department and for the reason that in addition to the staff of the appellant, the staff of M/s C C Chokshi was also using the said office space. In respect of office No. 602, it was alleged that the said premises were not registered with the Service Tax department and M/s were using it. DTTIPL and not by the appellant.
It was also argued that the said premises were included in the Centralised registration of the appellant only with effect from 20.06.2013. The appellant has claimed that the premises at office No. 202 were not being used by M/s C C Chokshi and company. This averment of the appellant has not been countered in the impugned order. The impugned order denies the credit simply on the ground that the invoices raised for the rent do not contain the prescribed particulars of Rule 4A of the Service Tax Rules, 1994 and were not addressed to the registered business premises of the appellant.
the allegations that the premises were being used by C C Chokshi are not substantiated by the impugned order. Moreover, the impugned order also does not deny that the said premises were rented to the appellant.
“As regards Office No. 602, it is seen that the appellant has admitted that they were not the sole users of said premises. The said premises were also being used by DTTIL along with the appellant. In this background, we do not find any merit in the appellant’s claim that they are entitled to the Cenvat Credit of the entire amount of service Tax paid. The Service Tax credit would be admissible in the proportion of the use of the said premises by the appellant.”, the Tribunal held. A two-member bench of Mr Ramesh Nair, Member ( Judicial ) and Mr Raju, Member ( Technical ) set aside the order denying the entire Cenvat Credit on premises No. 602 and remanded the matter to the original adjudicating authority to ascertain. The exact proportion of the said premises which was used by the appellant and allow the credit to that extent. The other objections regarding the defective invoice and the invoices being procedural cannot come in the way of the admissibility of the credit.
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