AI OCR 
TaxTMI 
TaxTMI 
TaxTMI 
2019 (3) TMI 1509
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....bruary 2009 for the same project in contravention of Rule 3 of the Works Contract Rules, 2007 resulting in short-payment of service tax. The audit group noticed that there was a short-payment of service tax to the tune of Rs. 11,01,03,335/- for the period February 2009 to October 2010 and for subsequent periods. The appellant paid up differential duty amount of Rs. 5,40,45,243/- along with interest of Rs. 94,77,331/- by way of cash and the balance of Rs. 5,60,58,092/- was paid by adjustment from the CENVAT account. The appellants were availing the benefit of Notification 1/2006 and therefore had unutilized CENVAT credit. They did not pay the interest for the amount of Rs. 5,60,58,092/-, which they had adjusted from the CENVAT account. The department was of the view that they are liable to pay interest upon the service tax which was paid belatedly by adjustment of the CENVAT account also. Show cause notice dated 15.3.2014 was issued raising the demand of short-payment of service tax which was adjusted from the CENVAT account and demanding interest of Rs. 1,19,04,818/-. After due process of law, the original authority confirmed the demand of Rs. 5,60,58,092/- and appropriated the amo....
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....mitting tax originally under WCS and thereafter switched over to the residential complex service consequent to the issue of the circular of the Board clarifying that developer is not liable to pay tax and subsequently started paying the tax under the construction of complex service once the benefit of the circular was withdrawn through the amendment notified through Finance Act, 2010 and that too by foregoing the benefit of input service tax credit on account of their adopting to pay the tax by availing notification benefit 1/2006-ST and which duty payment was more than tax liable to be paid by them under WCS (compounded rate) with the additional benefit of input service tax credit should also stand against the invocation of the extended period. 2.5 All the activities of the appellant were in the knowledge of the department and they also complied with the differential tax payment immediately on being advised even though they could have claimed the benefit of Board circular till June 2010 and in spite of the same the show cause notice was issued to them restricting it to the demand for the input service tax credit taken and adjusted by allowing the said adjusment clearly showing th....
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.... Ltd. Vs. Commissioner of Central Excise, Raigad - 2017 (358) ELT 416 (Tri. Mumbai). 3. The ld. AR Shri K. Veerabhadra Reddy supported the findings in the impugned order. He pointed out that the appellant had paid part of the demand to the tune of Rs. 5,40,45,243/- by way of cash and for this cash payment, the appellant had paid interest of Rs. 94,77,331/-. Though the appellant has adjusted Rs. 5,60,58,092/-, the same was informed by a letter dated 23.3.2012 and payment was not accompanied by interest. Whenever the tax is paid by adjustment from the CENVAT credit account, the appellant has to pay the interest that follows the tax demand. Admittedly, there is a delay in payment of service tax. The appellant is therefore bound to pay the demand of interest of Rs. 1,19,04,818/-. The demand confirmed is therefore legal and proper. 4. Heard both sides. 5.1 The ld. counsel is contesting the demand of interest and penalty imposed. As per the adjudication order, though the demand of Rs. 5,60,58,092/- which has been paid by adjustment from the CENVAT account is also confirmed, the same is not contested by the appellant. The contention in the present appeal is only with regard to interes....
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....cision in the case of Commissioner of Central Excise, Puducherry Vs. CESTAT, Chennai (supra), is misplaced on facts. In para 4 of the said judgment, it is seen that the Tribunal had relied upon the documentary proof produced before the Bench to hold that there was sufficient credit in the CENVAT account during the material period. It was also observed therein that short-levy was with regard to the clearances of goods to sister unit by adjustment in CENVAT account subsequent to merger of two units. The facts being entirely different, the said decision is of no assistance to the appellant. In the case of Steer Engineering Pvt. Ltd. (supra), the facts was that demand of interest being after reversal of CENVAT credit when credit was denied on the ground that imported machines were not used in relation to manufacture. As already pointed out, this is not a case of wrong credit availment. This is a case of utilization of CENVAT credit for discharge of service tax liability. The said decision is also not applicable to the facts of the present case. In the case of Nicholas Piramal (India) Ltd. (supra), the issue analysed was whether interest is liable to be paid on differential amount when ....