TMI Blog2018 (10) TMI 1418X X X X Extracts X X X X X X X X Extracts X X X X ..... of 50% of tax - reverse charge mechanism - it was alleged that appellant was not liable to pay service tax, therefore credit is not admissible - Held that:- No proceeding was initiated against the service provider. If the contention of the Revenue is accepted then there is short payment on the part of the service provider and in such case, proceeding for demand of 50% service tax should have been initiated against the service provider. In any case, the total service tax paid by either party i.e. by the service provider or service recipient is legally payable on the said service. The actual liability of service tax was discharged though 50% by service provider and 50% by the appellant. Therefore, on the service tax paid by the appellant cred ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t submits that in the order-in-original, in Para 15.2, the Adjudicating Authority has categorically agreed that the service received by the appellant fall within the ambit of definition of Input Service defined under Rule 2(l) of Cenvat Credit Rules. However, the credit was denied on the ground that service provider was supposed to pay 100% service tax and the appellant was not liable to pay service tax on the said service received, under reverse charge mechanism. Therefore, the Cenvat credit suo-moto availed of such service tax was not available to them. He submits that no proceedings were initiated against the service provider. Therefore, service tax paid by the appellant was accepted by the department as part of service tax payable by th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ven in Para 10.12 above. On perusal of above and on perusal of documents viz. Sample copies of work contracts and invoices, I find that work mentioned therein was related to repair and maintenance of various equipments and machinery and fabrication and erection of pipes, equipments, structural fabrication etc. I agree with assessee s submissions that the services provided by the above service providers were used directly or indirectly, in or in relation to the manufacture of finished goods of the assessee and therefore, they fall within the ambit of the definition of input service as defined in Rule 2(l) of Cenvat Credit Rules, 2004. I further find from the invoices that service providers in this case have paid service tax on 50% of the t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lity of input service has been settled in the order-in-original which has been accepted by the Revenue, as no appeal has been filed against the said finding. Once it is accepted that input service received by the appellant falling under definition of input service, there is no reason to deny the Cenvat credit. As regard the issue that the appellant was not liable to pay service tax, therefore credit is not admissible, I find that no proceeding was initiated against the service provider. If the contention of the Revenue is accepted then there is short payment on the part of the service provider and in such case, proceeding for demand of 50% service tax should have been initiated against the service provider. In any case, the total service ta ..... X X X X Extracts X X X X X X X X Extracts X X X X
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