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2019 (9) TMI 175 - AT - Central ExciseCENVAT Credit - suppression of facts - Rule 9(1)(bb) of CENVAT Credit Rules, 2004 - Department was of the view that as per Rule 9(1)(bb) of CENVAT Credit Rules, 2004, the challan for availing the credit is not a valid document as the amount was not paid by BPS to the Government and it amounted to suppression of facts with intent to evade payment of duty by the service provider namely BPS - HELD THAT:- In the present case, the service provider though collected the service tax from the appellant has failed to deposit with the Government. The appellant has made arrangements to adjust their dues pending with the service provider and paying the service tax on behalf of the service provider. The letter dated 21.12.2016 issued by the service provider (BPS) to appellant would establish that they have paid the service tax on behalf of BPS after adjusting all the pending dues between parties. Thus, it is very much clear from the facts that the appellant has paid the service tax at the time of paying the service charges - Merely because the service provider failed to deposit the same with the Government, the credit cannot be denied at the end of the service recipient. The Tribunal in the case of M/S LG ELECTRONICS INDIA PRIVATE LIMITED, BHARAT BHUSHAN SHARMA MANAGER VERSUS COMMISSIONER OF CENTRAL EXCISE & SERVICE TAX, NOIDA [2016 (11) TMI 21 - CESTAT ALLAHABAD] had occasion to analyse the similar issue and held that non-payment of service tax by service provider cannot be a ground for denying credit at the end of the service recipient. The disallowance of credit is unjustified - appeal allowed - decided in favor of appellant.
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