Condonation of Delay: Tribunal directed condonation where rectification proceedings were pursued, ordering merits adjudication after opportunity to be...
Restriction of Input Tax Credit under Rule 86A applies only to fraudulently or ineligible availed credit; mere wrongful recipient availment is insuffi...
Rule 6(5) of the CENVAT Credit Rules, 2004 allows full credit of service tax on specified input services notwithstanding the restrictions in Rule 6(1) to 6(3), unless the services are used exclusively for exempted goods. The Tribunal treated the disputed maintenance and software-related services as covered by Rule 6(5), so credit could not be denied merely because the services were common to dutiable and exempted production or because separate records were not maintained. It also recognised the retrospective amendment permitting proportionate reversal with interest for common credit disputes pending up to 31.03.2008, and found the department should have considered that relief. The demand, interest and penalty were set aside.
Rule 6(5) of the CENVAT Credit Rules, 2004 allows full credit of service tax on specified input services notwithstanding the restrictions in Rule 6(1) to 6(3), unless the services are used exclusively for exempted goods. The Tribunal treated the disputed maintenance and software-related services as covered by Rule 6(5), so credit could not be denied merely because the services were common to dutiable and exempted production or because separate records were not maintained. It also recognised the retrospective amendment permitting proportionate reversal with interest for common credit disputes pending up to 31.03.2008, and found the department should have considered that relief. The demand, interest and penalty were set aside.
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