TaxTMI 
TaxTMI 
2013 (8) TMI 801
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....a Non-banking Financial Service Company (NBFC) providing services taxable under Finance Act, 1994 as also undertaking activities which are not taxable under Finance Act, 1994. They take credit of service tax paid on input services which are common to both taxable services and non-taxable activities. As per Cenvat Credit Rules 2004, they are eligible to take credit of service tax paid on input ser....
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.... order. 3. From para 5 of the SCN, it is seen that Revenue considers certain items of receipts in their Profit and Loss Account for the two years as income from trading activity. It is argued that credit cannot be taken on input services used in relation to trading activities. The credit attributable to trading activities is calculated using the formula as indicated below: Proportionate credit a....
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....ribed by Reserve Bank of India. He argues that this cannot be considered as a trading activity. Similar is the argument in relation to dividend income which is from investment in shares. 6. Regarding the other major disputed item of profit on securitization/sell down of loans, the Counsel explains that the loans given by the applicant is sold to other financial institutions to generate funds as n....
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....ces which are common to taxable services. Since no tax is payable on receipts attributable to investments in Government securities and other financial instruments, he argues that Cenvat credit should be reversed on the ratio as suggested in the SCN and upheld in the impugned order. 10. In the matter of taxability of the income from securitization the Ld. A. R. submits that the applicant is also c....