2022 (10) TMI 695

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....nd exempted output services and failed to intimate the Range Superintendent their option as required under Rule 6(3A) (a) of the Cenvat Credit Rules, 2004. Therefore, it appears that Appellant required to pay an amount equivalent to 5% of the value of exempted services for the year 2011-12 and 6% for 2012-13 and 2013-14. Accordingly, show cause notice dated 19.09.2014 was issued to the appellant for the period April 2011 to March 2014alleging that, since the appellant had availed Cenvat credit in respect of common input service which are used for both dutiable and exempted services the appellant is required to pay an amount @ 5% /6% of the value of exempted service in terms of Rules 6(3)/6(3A) of Cenvat Credit Rules, 2004for the period 2011-2012 to 2013-14. Similar two SCNs were issue for the subsequent periods. The adjudicating authority i.e. Commissioner vide impugned Order-In-Original No. AHM-EXCUS-001-COMMR-28 to 30 -20-21 dated 17.02.2021 confirmed the demand along with interest and penalty. Aggrieved by the said orders, the appellant filed present different appeals. 02. Shri Harish Bindumadhavan & Shri Kumar Parekh, learned counsel appearing on behalf of Appellants submits....

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....84 • M/S TATA STEELS LTD. VS. CCEX. &S.TAX - 2020-VIL-336-CESTAT-KOL • PHILIPS CARBON BLACK LTD. & OTHERS VS. CCE- 2020(1) TMI-530-CESTAT -KOL • MERCEDES BENZ INDIA PVT. LTD. - 2015-TMI-1550-CESTAT-MUMBAI 03. Shri R P Parekh, learned Superintendent (AR) appearing on behalf of the Revenue reiterates the findings of the impugned order. 04. We have considered the submissions made by both sides. From the facts and circumstances of the case and arguments put forth by rivals, we find that the issue to be decided by us is whether appellant is required to pay 5% or 6% of total sale value of the goods traded by them in terms of provisions of Rule 6(3) when the appellant agree for reversal of actual credit attributed to the quantum of trading sale (trading activity) in terms of Rule 6(3A) following the option available under Rule6(3). Provisions for payment of 5% or 6% of the sale value of exempted goods / exempted services is provided as one of the option given in Rule6(3) of Cenvat credit Rules which is reproduced below :- RULE 6. Obligation of a manufacturer or producer of final products and a [provider of output service. - (1) The CEN....

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...., and shall take CENVAT credit only on inputs under sub-clauses (ii) and (iv) of clause (a) and input services under sub-clauses (ii) and (iv) of clause (b). (3) Notwithstanding anything contained in sub-rules (1) and (2), the manufacturer of goods or the provider of output service, opting not to maintain separate accounts, shall follow [any one] of the following options, as applicable to him, namely :- (i) pay an amount equal to five percent of value of the exempted goods and exempted services; or (ii) pay an amount as determined under sub-rule (3A); or (iii) maintain separate accounts for the receipt, consumption and inventory of inputs as provided for in clause (a) of sub-rule (2), take CENVAT credit only on inputs under sub-clauses (ii) and (iv) of said clause (a) and pay an amount as determined under sub-rule (3A) in respect of input services. The provisions of sub-clauses (i) and (ii) of clause (b) and sub-clauses (i) and (ii) of clause (c) of sub-rule (3A) shall not apply for such payment : Provided that if any duty of excise is paid on the exempted goods, the same shall be reduced from the amount payable under clause (i)....

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....the department that this option should be given in beginning and before exercising such option, we are of the view that though there is no such time limit provided for exercising such option in the rules but it is a common sense that intention of any option should be expressed before exercising the option, however the delay can be taken as procedural lapse. We also note that trading of goods was considered as exempted service from 2011 only, thus it was initial period. We are also of the view that there is no condition provided in the rule that if a particular option, out of three options are not opted, then only option of payment of 5% or 6% provided under Rule 6(3)(i) shall be compulsorily made applicable, therefore we are of the view that Revenue could not insist the appellant to avail a particular option. In the present case admittedly it is appellant who have on their own opted for option provided under Rule 6(3)(ii). It is the appellant who have liberty to decide which option to be exercised and not the Revenue to decide the same. 4.3 We find that the appellant in the present matter agree to reverse to cenvat credit, this is not under dispute. Therefore in our view, the ap....