2018 (5) TMI 218

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....nd financial services which include lending service. The case of the department is that in terms of Rule 6(2) of the Cenvat Credit Rules, 2004, in case the assessee provides both taxable as well as exempted/non - taxable output service, then he is required to maintain separate accounts and inventories for dutiable and exempted services. If he does not maintain separate account, then he can intimate in writing to the jurisdictional Assistant Commissioner of Central Excise and Customs about his intention to pay proportionate credit on input/input service used in exempted service in terms of sub - rule (3A) of Rule 6 of Cenvat Credit Rules, 2004. If the assessee does not follow any of the above procedure, then as per Rule 6(3)(i) of the Cenvat....

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....stomer is per se taxable service and the appellant is discharging the service tax on such taxable service. He submits that in case of service of banking and financial service, from the gross value, the value equal to the interest has been excluded. Similarly, in the case of overdraft facility, cash credit facility or discounting of bills, bills of exchange or cheques, the amount of interest on such facilities is exempted by Notification No.29/2004 - ST dated 22.9.2004. This exemption is only sort of abatement in the gross value but the service is per se is taxable. Therefore, it cannot be said that the appellant is providing the lending service, overdraft facility, cash credit facility or discounting of bills, bills of exchange or cheques a....

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....ision of Rule 6(3)(i) of Cenvat Credit Rules, 2004 is applicable. Notification No.29/2004 - ST is reproduced below: - "Service tax exemption for providing services of overdraft, cash credit or discounting of bills on value of interest or discount In exercise of the powers conferred by sub - section (1) of section 93 of the Finance Act, 1994 (32 of 1994), the Central Government , being satisfied that it is necessary in the public interest so to do, hereby exempts so much of the value of taxable service provided to a customer, by a banking company or a financial institution including a non - banking financial company, or any other body corporate or commercial concern, in relation to, - (a) overdraft facility; (b) ca....

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.... ground that the service per se is not exempted. Only a part of the value is exempted of taxable service under Notification No.29/2004 - ST dated 22.9.2004. As we have already discussed above, we agree with this observation. On going through this Tribunal's decision in the case of Vaidyanath Urban Co - operative Bank Ltd. (supra), we find that the identical issue involved in the said case. Therefore, the ratio of the judgment is applicable. The relevant finding of t he said order is reproduced below: - "5. Considering that the issue is full covered by Jost's Engineering (supra) and in the case of Nagar Urban Co - operative Bank Ltd. (supra), I find that the appellant's case is squarely covered. Further, the aforementioned ruling wa....