TaxTMI 
TaxTMI 
2020 (7) TMI 264
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.... service tax, due to the export of services. In response to query appellant further clarified that the input services have been consumed in marketing in pre-sale and support services activities, among others. The summary of input credit availed/utilized was filed along with the rebate claim. The appellant was also engaged in trading and they were following the procedure prescribed under Rule 6(3A) of Cenvat Credit Rules, to determine the ineligible cenvat credit attributable to exempted services. It appeared to Revenue that while calculating the percentage of ineligible credit under Rule 6(3A), appellants have not included the amount of cenvat credit availed on Information Technology and Software Services (ITSS for short) contending that such ITSS is also a taxable output service, which contention appears to be incorrect. 3. On scrutiny of the ST-3 returns for the financial year 2008-09, the tax liability and its payment appeared as follows: Service rendered Ass value Service Tax Ed Cess She cess Total MRS 131538280 15529995 310600 155300 15995895 CAI 625197180 70910623 141821....
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.... 4 ITSS (Service provider) (zzzze) does not form part of the 16 services 5 ITSS (Import payment) Service Recipient 5. It appeared to Revenue that ITSS service is not covered under Rule 6(5) and the appellants have availed 100% credit both as service provider and service recipient, which is incorrect and the credit so availed is to be restricted to 5% alone. It further appeared that appellants have availed excess credit in respect of other services. 6. It further appeared that the amount of ineligible cenvat credit attributable to exempted services, the appellants should have applied the percentage of ineligible credit, included under Rule 6(3A) of CCR to the credit availed on ITSS also and paid the said amount along with interest as applicable. Further appellants for computation of value of exempted services, i.e. trading in the instant case, have claimed deduction towards ITSS, treating it as taxable output service, without proper justification for the same. Thus it appeared that appellants have failed to adopt the correct formula in arriving at the percentage of ineligible cenvat credit, in terms of Rule 6(3A)(c) of CCR. 7. It further appeared that cenvat c....
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....690/- (Rupees Twenty Five Crore Seventy Seven Lakh Two Thousand Six Hundred and Ninety only) taken for the year 2008-09, 95% of the credit or Rs. 20,55,85,446/- (Rupees Twenty Crore Fifty Five Lakhs Eighty Five Thousand Four Hundred and Forty Six only) is ineligible and out of the balance of Rs. 5,21,17,244/- (Rupees Five Crore Twenty One Lakh Seventeen Thousand Two Hundred and Forty Four only) the credit is ineligible as the services do not fall under the purview of 'input services' or the invoices are lacking in one respect or another. Accordingly, show-cause notice dated 23/10/2009 was issued for the period 2008-09 proposing to disallow and recover cenvat credit of Rs. 25,77,02,690/- (Rupees Twenty Five Crore Seventy Seven Lakhs Two Thousand Six Hundred and Ninety only) with interest under Rule 14 of Cenvat Credit Rules and further demand of Rs. 17,06,11,238/- (Rupees Seventeen Crore Six Lakhs Eleven Thousand Two Hundred and Thirty Eight only) was proposed as service tax short paid/not paid, along with interest and penalty was also proposed under Section 78 read with Rule 15(4) of Cenvat Credit Rules. 8. The show-cause notice was adjudicated on contest confirming the disallow....
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....n cess + secondary & higher education cess] from M/s. Dell India Private Limited under the provisions of Rule 14 read with Section 75 of the Finance Act, 1994; 9.4 Imposed a penalty of Rs. 14,14,46,763/- (Fourteen Crore Fourteen Lakh Forty Six Thousand Seven Hundred and Sixty Three) only on M/s. Dell India Private Limited under the provisions of Rule 15(4) of the Cenvat Credit Rules read with Section 78 of the Finance Act, 1994 for the irregular service tax credits taken by them and 9.5 Further, taking recourse to Section 80 of the Finance Act, 1994, penalty was not imposed under the provisions of Section 78 of the Finance Act, 1994, for non-payment/short payment of service tax on 'management, maintenance or repair' service, 'erection, commissioning or installation' service, 'information technology software' service and 'business auxiliary' service." Being aggrieved, the appellant is before this Tribunal. 10. The learned counsel for the appellant urges that cenvat credit of service tax paid amounting to Rs. 6,22,33,589/- (Rupees Six Crore Twenty Two Lakhs Thirty Three Thousand Five Hundred and Eighty Nine only) pertaining to various 'common services' used by them for tr....
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....he finding in the impugned order as to 'invalid document', 40 invoices is concerned, it is urged that the appellant is assessed to service tax for last several years and the audit team of the Department have already conducted the audit in review and verified the accounts, and process being followed by appellant for availing the cenvat credit. The audit team did not report any material deviation as to details maintained by appellant. Further as regards discrepancies in the invoices in a few instances, the appellants have reversed the credit with interest, under intimation to the Department. In spite of requests made by the appellant to learned Commissioner to provide a list of invoices objected to by Revenue, so as to clarify the objections but no such list was ever provided. The show-cause notice was also silent as to the particulars of invoices which are defective and such allegations are only by way of a vague and passing allegation. 10.6 He further urged that under the facts and circumstances, the appellants have properly followed the provisions of the Service Tax Law with Rules read thereunder and there is no case of any deliberate default, penalties imposed are fit to be se....
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...., appellants have made out a case for availment of the entire cenvat credit of service tax paid on Management Consultancy Services as per the above reproduced sub-rule. To that extent the appeal filed by the appellant is allowed and the demands raised on this ground, the question of interest does not arise." 10.9. Learned counsel further states that on similar allegations for the period 2015-16, the show-cause notice was issued which have been adjudicated vide O-I-O No. 30/2018 dated 28/03/2018 wherein the learned Commissioner have dropped the proceedings following the ruling of this Tribunal in IBM India (Pvt.) Ltd. (supra). Particularly mentioning in para 25.5, that this order in IBM of this Tribunal have been accepted in review by the Department on 03/07/2015. Learned Commissioner also took notice of the Notification No. 13/2016 dated 01/03/2016 where Rule 6 of Cenvat Credit Rules was re-drafted, particularly Rule 6(iii) which is as follows: "(i) No credit of inputs or input services used exclusively in manufacture of exempted goods or for provision of exempted services shall be available; (ii) Full credit of input or input services used exclusively in final....