TaxTMI 
TaxTMI 
TaxTMI 
2019 (1) TMI 1245
X X X X Extracts X X X X
X X X X Extracts X X X X
....he appellant nor addressed to the registered premises of the appellant nor even appearing the service tax registration of the appellant. ii) The service tax paid in excess to the Government account on renting/ leasing of manufacturing facilities has been adjusted later without following the procedure. iii) Since the separate accounts were not maintained while providing taxable and exempted services, the appellant is liable to reverse the property credit availed instead of trading activity. iv) The appellants have wrongly availed the cenvat credit of service tax paid on the outward freight incurred for transporting their finished products from their Mandoli godown to their distributor. v) Service tax qua the merit of service is wrongly been paid under reverse charge through cenvat credit. vi) Appellant had short paid the service tax under reverse charge for intellectual property rights and that the appellant has not paid the service tax on miscellaneous income/ R&D income. Resultantly, SCN No. 109 dated 20.03.2014 was served upon the appellants proposing the recovery of: (a) cenvat credit amounting to Rs. 5,90,26,961/- (b) service tax amounting to Rs. 10,50,601/-, Rs. 14,79....
X X X X Extracts X X X X
X X X X Extracts X X X X
....tax paid on the said services to such manufacturer or producer or provider as the case may be. Rule 4 of Service Tax Rules provides that the assessee can take Centralised Registration providing service from more than one premises or offices which are engaged in relation to such services and has centralized billing/ accounting system and may at its option registered such premises or offices where centralized billing/ accounting systems are located. Rule 4A(ii) of Service Tax Rules provides ISD distributing credit of taxable services shall, in respect of credit distributed, issue an invoice, a bill or a challan for each of the recipient of the credit distributed such invoice/ bill or challan shall be numbered and shall contain the following details: a) the name, address and registration No. of the person providing input services b) the name and address of the input and service distributor c) the name and address of the recipient of the credit distributor d) the amount of credit distributed Rule 7 of CCR, 2004 provides for manner of distribution of credit by ISD and provides two conditions: (a) Credit distributed against a document referred to in Rule 9 does not exceed th....
X X X X Extracts X X X X
X X X X Extracts X X X X
....s as mentioned above in Rule 4A of the Service Tax Rules and such documents shall be submitted as mentioned above in Rule 9 above. Now coming to the admitted facts in the present case: (a) The appellant is head office for all its units differently located and is a registered ISD (b) All the invoices issued by the service provider bears the appellant's name however with the address of the unit to which the service was provided. (c) The tax was paid by the appellant/ the head office in respect of the invoices for which credit has been taken. (d) The Branch office have no accounting system and their accounts form part of the head office accounts which is registered as an ISD (e) Service tax is accounted for in the books at head office only and service tax paid on the same is also accounted for by the said head office for the returns regularly filed with the revenue. (f) The head office/ ISD has the centralized registration for discharging the service tax obligations to its Branch offices. These admitted facts makes it clear that all the conditions in the above mentioned Rules duly stand fulfilled for appellant as an ISD to take the cenvat credit. 3.4 The only lacuna on ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....oviding manufacturing facility utilities and services on employees and also for transfer of material. Appellant deposited the tax for the quarter Oct to Dec 2009 however after panEra issued two debit notes both dated 23.04.2010 informing about not using the premises/ plants during the said quarter that the appellant adjusted the service tax already paid against the service tax liability for the subsequent period. The Commissioner (Appeals) has denied the said adjustment merely on the ground that the appellant has failed to fulfill the conditions of Rule 6(4A) of Service Tax Rules. It is submitted that it is Rule 6(3) STR which is applicable and not 6(4A) thereof. The findings are accordingly prayed to be set aside. 4.1 Ld. DR has per contra justified the findings of the Commissioner that it is hard to believe about appellant to not to be aware about no service being provided in the said quarter. Above all there was no evidence that the agreement was terminated. Resultantly, it is Rule 6(4) and Rule 6(4A) which is applicable and not Rule 6(3) of Service Tax Rules. Issue is accordingly prayed to be decided against the appellant. 4.2 After hearing both the parties and perusing the i....
X X X X Extracts X X X X
X X X X Extracts X X X X
....was also involved into the trading activity. SCN alleged the same to be an exempted service. Accordingly, the reversal of proportionate amount of credit was proposed which has been confirmed. It is submitted by the Ld. Counsel for the appellant that the trading was not an exempted service till 01.04.2011 when the Notification No. 03/2011 dated 01.03.2011 got enforced. Thus Commissioner has been wrong while confirming the entire demand including for the period prior to 01.04.2011. It is submitted that however proportionate amount was reversed under protest. Ld. DR on the other hand has submitted that even prior the Notification of 01.03.2011 trading was an exempted service such as the Commissioner has rightly ordered appropriation of the amount deposited on account of reversal of the credit taken on the exempted services. 5.1 After hearing both the parties it is apparent on record that 100% cenvat credit on service tax paid on input services has been availed by the appellant despite that the appellant was involved into trading activity as well. We also observe that the statute did not have the definition of trading as service for the period before 01.04.2011. The period involved he....
X X X X Extracts X X X X
X X X X Extracts X X X X
....from outside India are not disputed to be taxable nor is disputed the appellants liability to pay the tax thereupon under reverse charge mechanism. The only fact and issue is as to whether such liability can be discharged from the account of cenvat credit instead of being discharged in cash. 7.2 Section 68 sub section 2 of the Finance Act, 1994 (the Act hereinafter) is relevant. In accordance whereof in respect of any taxable service as notified by Central Government in official gazette the service tax thereon shall be paid by such person and in such a manner as has may be prescribed at the rate specified in Section 66 of the Act (period being prior 2012). According to Section 66 of the Act there shall be levied a tax at the rate of 12% of the value of taxable services as referred in various clauses. As per Section 66A of the Act where the service provider is outside India but the recipient is in India, such taxable service shall be treated as if the recipient had himself provided the service in India and accordingly all the provisions of this Chapter shall apply. [Proviso to this Section are not applicable to facts and circumstances of this case] Further, according to Section 67 ....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... tax appears to be as tabulated below: Return Bill Date Bill No. Taxable amount Service Tax Edu Cess Sec Total service tax Apr 09 - Sep 09 30.09.2009 LIC/DRL/003 3916729 391673 7833 3917 403423 Oct 09 - Mar 10 31.03.2010 LIC/DRL/005 7689721 768972 15379 7690 792041 Total Billing Amount TDS Deducted Net payment received Cheque No. Cheque Date Date of credit in Account 4320152 432016 3888136 344872 12/11/2009 21/11/2009 8481762 848177 7633585 156713 02/06/2010 09/06/2010 when these figures are read with the impugned ST-3 returns of April-September 2009, no doubt it is apparent that the outstanding amount was not correctly shown in the said return however the above table clarifies that the tax otherwise stands paid fully. The Commissioner has ignored the documents, the compilations whereof is provided by the appellant in the form of above table at the stage of personal hearing itself. The findings about lack of evidence are therefore not sustainable. The findings qua this issue are also set aside. 9. Issue No. 7 Liability on the figure of Miscellaneous Income shown in the balance sheet the liability on the Misc income a....