2016 (4) TMI 983

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....at the respondent are provider of taxable services mainly under the category of "Business Auxiliary Services" as defined under Section 65 (19) of the Finance Act, 1994, in addition to various other services. The respondent is registered with service tax cell and paying service tax. During the course of audit undertaken by the department, the ledgers of Cenvat on Capital goods, Input services and Inputs scrutinized. It was observed that the appellant misused the facility of Cenvat credit by taking credit on input/input services, which was used by them as well as by other companies and input services which are not utilized for providing output services. On such observations of the audit officers, respondent have reversed the entire credit ava....

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....tion 73(3). 4. On the other hand, Shri. Jitu Motwani, Ld. Counsel for the assessee vehemently argued that from the very nature of input services it can be seen that all these services have been held as input services in one or other judgments by the Tribunal and other Hon'ble Courts. The respondent without contesting the issue of admissibility of the input services suo moto reversed the entire amount of Cenvat credit and also paid the interest and filed an application under Section73(3) therefore Ld. Commissioner has correctly accepted the application and dropped the proceedings. In the present case there is no dispute about the payment of Cenvat credit alongwith interest, the only issue is whether the penalty could have been imposed. ....

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....partment should not have issued show cause notice. For accepting the application under Section 73(3) and dropping the proceedings, Ld. Commissioner has given detailed finding, which is reproduced below: 12. I have carefully gone through the facts of the case and the submissions made by the noticee. 13. M/s Venkateshwara Hatcheries Pvt. Ltd. (VHPL) are registered as providers of "Business Auxiliary Services" and other services. They availed of cenvat credit on inputs and input services provided not only to them but to their group companies also. Further they availed of input service credit in respect of input services which were allegedly not utilized for providing output services. The noticee has paid the entire amount of impugned service....