2018 (11) TMI 346

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....d the credit of the duty paid by the suppliers. 2. The dispute relates to availment of credit of the said duty. The Revenue's contention is that inasmuch as the supplier of the goods was entitled to benefit of exemption Notification No. 22/2003-CE dated 31.3.2003, they should not have paid duty, in which case, the appellant becomes disentitled to avail the credit. Accordingly, after initiating proceedings against the appellant, demand of duty to the tune of Rs. 2.78 crores approximately stands confirmed against them, by denying them the credit. Further, penalty of identical amount stands imposed upon the appellant. 3. After hearing both the sides duly represented by Shri S.S. Gupta, ld. Counsel appearing for the appellant and Shri S.K. Ba....

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....redit of duty paid by the manufacturer supplier. Accordingly, the demand of Rs. 2,78,19,091/- is set aside along with setting aside of penalty. 5. Further, we find that credit of Rs. 21,68,285/- in respect of the service tax paid by the appellant's head office, which is also registered as ISD, stands denied on the ground that such service tax was paid by the head office, on reverse charge basis, in terms of the provisions of VCES, 2013. As such, the adjudicating authority has observed that the tax was not paid by the head office in routine but disclosure was made under the said scheme, thus establishing that there was suppression on the part of their head office, in which case the credit would not be available to them. 6. We have gone thr....

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....governed by the provisions of Cenvat Credit Rules, 2004. There is no clarification to the effect that the duty/tax paid under the said scheme would be admissible as a credit. It only clarifies that the Cenvat credit would be governed by the Cenvat credit Rules, 2004. We have already examined the applicability of the said rules and have observed that the said rule deny availing the credit in respect of the tax/duty paid under suppression or mis-statement. As such, we hold that the said circular is not applicable to the facts of the case. 8. Ld. Advocate has also drawn our attention to the Tribunal's decision in the case of Neelikon Food Dyes and Chemicals Ltd. Vs. Commissioner of CGST, Belapur - 2018 (3) TMI 1420 - CESTAT Mumbai, wherein th....