TaxTMI 
TaxTMI 
2015 (12) TMI 1050
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....ory of scientific and technical consultancy, transport of goods by road (GTA) and Business Auxiliary service (commission paid outside India) for which appellants hold Service Tax Registration. The appellants were also availing cenvat credit facility of duty paid on inputs, capital goods, and input services. In the course of audit it was observed that appellant had wrongly taken credit on inputs amounting to Rs. 4,47,827/-, but had subsequently reversed the same. The appellant was required to pay the interest of Rs. 22,843/-from the date of wrongly taking credit to the reversal of the same. In response to the letter, the appellant intimated the department that the credit was wrongly taken in excess of the admissible credit during the period ....
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....ation. He placed reliance on the judgements rendered by Hon'ble Apex Court in the appellants' own case and reported in 2011(265) ELT 3 (SC) . The other cases relied by the Revenue are CCE, Pune vs.G.L. & V India Pvt.Ltd.-2015 (321) ELT 611 (Bom.) and CCE, Chennai vs. Delphi TVS Diesel Systems Ltd.-2015 (322) ELT 279 (Mad.) 5. The period of dispute in the present case is April 2007 to December 2007. The appellants had wrongly taken the credit and had reversed the same on their own on coming to know of the mistake. The appellants thus have not taken any benefit of the wrong entry. The objection was raised in the course of audit and the department directed the appellant to pay interest from the date of taking credit, till the date o....
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....s, 2004. The Hon'ble High Court in the case of Bill Forge (P) Ltd. observed as under:- 20.............. "The assessee uses the credit to make payment of excise duty on excisable product. Instead of paying excise duty, the cenvat credit is utilized, thereby it is adjusted or set off against the duty payable and a debit entry is made in the register. Therefore, this is a procedure whereby the manufacturers can utilise the credit to make payment of duty to discharge his liability. Before utilization of such credit, the entry has been reversed, it amounts to not taking credit. Reversal of cenvat credit amounts to non-taking of credit on the inputs". 21. Interest is compensatory in character, and is imposed on an assessee, ....
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.... liability to pay interest would not arise. The liability to pay interest would arise only when the duty is not paid on the due date. If duty is not payable, the liability to pay interest would not arise". 8. Another judgement placed before me is the decision of the Hon'ble High Court of Madras (Madurai Bench) in CCE, Madurai vs. Strategic Engineering (P) Ltd., dated 10.2.2014. In this judgement, the Hon'ble Court has not only considered the decision in Indo Swift Laboratories' case and the view taken in M/s.Bill Forge (P) Ltd. case but has also analyzed the subsequent amendment brought forth in Rule 14 of the Cenvat Credit Rules, 2004. The Hon'ble High Court has observed therein as under: 11. It is an admitted f....
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....hat interest is not chargeable on the cenvat credit which was taken and reversed before utilization. 10. On the other hand, the Revenue relies upon the judgements of the Hon'ble Madras High Court in Delphi TVS Diesel Systems Ltd. (supra) decided on 31.1.2014, wherein the Hon'ble High Court held that interest is chargeable even if the credit is reversed before utilization. The Hon'ble Court therein relied upon its own decision rendered in CCE vs. Sundaram Fasteners Limited case decided one day before the decision made in Delphi TVS Diesel Systems Ltd. case. The Hon'ble High Court was more inclinded to follow the dictum of Apex Court in Indo Swift Laboratories case and distinguished the judgement in M/s.Bill Forge (P) Ltd. ....