2009 (12) TMI 76

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....e been disallowed service tax credit in respect of the impugned services on the ground that the credit was availed by them on the basis of ineligible documents namely debit notes issued by their service providers. 3. Shri V.S. Manoj, learned counsel, has shown some representative debit notes annexed to the appeal papers. These debit notes show that service tax and education cess have been debited for the commission paid by the appellants to their consignment agents. The learned counsel argues that as per Section 67 of the Finance Act, 1994, "the gross amount charged" includes payment by cheque, credit card, deduction from account and any form of payment by issue of credit notes or debit notes etc. He states that when the taxable value it....

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....ice. While passing Stay Order No.1021/20 dated 7-12-2009 in the case of Indian Furniture Products Ltd. v. CCE, Chennaj in Appeal No. E/510/2009, it was noted by the Division Bench of the Tribunal as follows:- Moreover, Section 37(2) of the Central Excise Act, 1944, allows the Central Government, inter alia to make rules for the following:- "xvi(a) provide for the credit of duty paid or deemed to have been paid on the goods used in, or in relation to, the manufacture of excisable goods; xvi(aa) provide for credit of service tax leviable under Chapter V of the Finance Act, 1994 (32 of 1994) paid or payable on taxable services used in, or in relation to, the manufacture of excisable goods;" It is clear from the above provisions tha....

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....rate of interest as an alternative mode of levy of interest per day not connected with the amount of duty in default is beyond enabling power of the Parent Act. The Rule 8(3) to the extent it provides after providing the rate of interest chargeable on delayed payment of duty, an alternative mode to provide higher ceiling limit is clearly in violation of Section 11AB and cannot be sustained. 13. Since the alternative mode is severable from the other part of the provision without affecting its efficacy, it does not require that the entire rule is to be struck down. 14. We, therefore, hold that Rule 8(3) to the extent it provides levy of interest at the rate of Rs. 1,000/- which is higher as alternative to charge of interest @ 2% on the ....