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2014 (12) TMI 913 - AT - Service TaxCENVAT Credit - appellant has taken Cenvat credit on the basis of proper cenvatable documents but during the course of Audit it was observed that the service providers did not pay the required service tax - Held that:- It is evident from the provisions contained in Rule 4(7) of the Cenvat Credit Rules that Cenvat credit in respect of input services has to be allowed for the service tax paid or payable as indicated in the invoice, bill or, challan referred to in Rule 9 of the Cenvat Credit Rules. There is no provision in the Cenvat Credit Rules that if any amount of service tax shown to have been paid or payable in the duty paying document is not paid by the original manufacturer or the service provider, then Cenvat credit taken is required to be varied at credit taking end. To clarify this matter further it is observed that C.B.E. & C. under Circular No. 766/82/2003-CX., dated 15-12-2003, issued vide No. 201/45/43-CX, has given clarification and made amply clear that the recipient of the inputs/input services should not be asked to reverse the Cenvat credit availed in such cases so long as the bona fide nature of the consignee’s transaction is not in dispute. In the case of the appellant there is no evidence that the transaction between the service provider and the service recipient was not bona fide. At the time of receiving of duty paying document appellant cannot be expected to verify whether proper service tax has been paid by the appellant or not. In view of the above after allowing the stay applications/appeals themselves are taken up for final disposal. - For the reasons recorded above when service tax credit has been taken on the basis of valid documents by the appellant the credit is required to be allowed in view of Rule 4(7) of the Cenvat Credit Rules which has also been clarified under C.B.E. & C. Circular dated 15-12-2003 by the Revenue - Decided in favour of assessee.
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