AI OCR 
TaxTMI 
TaxTMI 
TaxTMI 
2023 (10) TMI 527
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....dit of Rs.8,69,567/- on input services used exclusively for exempted services which was in violation of Rule 6 (1) of CCR, 2004. 2.2 Again, the appellant had availed ineligible credit on insurance premium paid on motor vehicles used by their Directors / officials (Rs.1,02,930/-), tour and travels Services (Rs.1,87,518/-), Entertainment Services (Rs.7,57,185/-) all of which appeared to be not covered by definition of 'input service' under Rule 2 (l) of CCR 2004. 2.3 The appellant had also taken credit of Rs.10,69,893/- based on a debit note raised by M/s.Kadri Consultants Pvt. Ltd., who had rendered architect service, which is not a prescribed document under Rule 9 of CCR 2004 for availing credit. 3. Thus, the appellant appeared to have availed ineligible credit amounting to Rs.29,87,093/-. It was also found that the appellant has short paid tax to the extent of Rs.24,10,286/- as a result of utilizing credit in excess of 20% limit. Hence show cause notice dt. 19.10.2009 was issued to the appellant invoking the extended period of limitation demanding the amount under Rule 14 of CCR 2004 read with proviso to Section 73 (1) of Finance Act, 1994 along with interest and for imposing p....
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....tted and paid demand amount Rs.8,69,567/- payment made prior to issuance of SCN vide challan dated 17.09l2008. Extended period of limitation Invoked for the whole demand. Entire demand is beyond the normal period of limitation. 5.1 It is submitted by the learned counsel that the first issue is with regard to the demand raised alleging wrong utilization of cenvat credit over and above 20% of the output tax liability in contravention of Rule 6 (3) (c) of Cenvat Credit Rules, 2004. It is submitted by the counsel that with effect from 01.04.2008 the said provision was omitted and thereby there was no curtailment of utilizing the credit even though credit availed for taxable and exempted services. The decision in the case of GE Money Financial Services Pvt. Ltd. Vs CST - 2019 (5) TMI 1569 CESTAT CHANDIGARH was relied by the learned counsel to submit that the Tribunal in the said case relied upon the decision in the case of Mumbai International Airport Pvt. Ltd. Vs CCE Mumbai - 2014 (33) STR 308 (Tri.-Mum.) to hold that the assessee is only liable to pay interest from the date of utilization of cenvat credit till 01.04.2008 and that the demand in respect of the said violation cannot ....
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.... health of the said employees and is directly in relation to the business of the appellant. To support this contention, the learned counsel relied upon the decision in the case of Commissioner of Central Excise Vs Micro Labs Ltd. - 2011 (6) TMI 115 KARNATAKA HIGH COURT; Sundaram Brake lining Vs CCE Chennai - 2014 (9) TMI 877 - CESTAT CHENNAI. * The department has denied credit on the insurance services availed by the appellant. These services were availed for official business purposes which is evident from the invoices. Ld. Counsel adverted to the discussions in the impugned order and submitted that the original authority has erroneously observed that the transportation services for pick up of employees from home and drop in the office cannot be treated as input services. It is asserted that the invoices are raised in the name of the company. The cost of such services goes into the cost of the company and therefore these relate to business activities of the company. The decisions in the case of Health India Medial Services Pvt. Ltd. Vs CST Mumbai - 2016 (6) TMI 280 CESTAT MUMBAI and CCE Vs Hyderabad Industries Ltd. 2015 (7) TMI 510 MADRAS HIGH COURT were relied. * The original....
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.... and it would not be now possible for the appellant to procure any details even if remanded after such lapse of time. The decision in the case of Mafatlal Industries Ltd. Vs CCE & ST Ahmedabad -2020 (43) G.S.T.L 562 (Tri.-Ahmd.) was also relied by the counsel. 5.4 The fourth issue is with regard to the demand of Rs.8,69,567/-which the appellant has admitted and paid on 17.09.2008. The learned counsel submitted that the said amount is in respect of credit availed on exempted services. On being pointed out by the audit, the appellant had immediately paid the amount. However, the interest was not paid along with the tax amount. The show cause notice has been issued invoking the extended period alleging suppression of facts with intent to evade payment of tax on the part of the appellant. It is submitted by the counsel that such allegation is baseless. The appellant had disclosed the availment of credit in respect of Rs.8,69,567/- in the ST-3 returns. They were not aware that the credit availed is incorrect. There is no willful suppression on the part of the appellant. Immediately when the error was pointed out, the appellant paid the amount prior to the show cause notice. It is argue....
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....f such accumulated Cenvat credit by the taxpayer after 1-4-2008. Further, it must be kept in mind that taking of credit and its utilization is a substantive right of a taxpayer under value added taxation scheme. Therefore, in the absence of a clear legal prohibition, this right cannot be denied." 9. The Tribunal in the case of GE Money Financial Services P. Ltd. (supra) had occasion to analyse the very same issue. It was held that the demand to recover the amount utilized over and above 20% cannot sustain and that the assessee would be liable to pay interest for the intervening period from the date of excess utilization of credit till 01.04.2008. It was also held that penalty cannot be imposed. The relevant para reads as under : 7. Without going into the merits of the case, we find that the appellant has provided the taxable services as well as exempted services. It is fact that during the impugned period, the appellant was providing taxable services and well exempted services but there is restriction for utilization of credit upto 20% lying in their Cenvat credit account. Admittedly, the appellant has availed the credit more than 20% during the impugned period. With effect from....
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....aid decision, we are of the opinion that the demand of service tax to the tune of Rs.24,10,286/- cannot sustain and requires to be set aside. The penalties imposed also cannot sustain and are set aside. However, the appellant is liable to pay the interest on this amount from the date of utilisation of credit till 01.04.2008. Ordered accordingly. 11. The second issue is with regard to credit availed on various input services. At the outset, it has to be stated that the period involved is April 2007-March 2008 when the definition of 'input service' had wide ambit as it included the words "activities relating to business". The appellant has availed credit on input services in the nature of premium paid on motor vehicle insurance, group insurance for employees, personal accident insurance for employees, life insurance etc. The other services are tour and travel and event management service (entertainment service). In the decisions relied by the learned counsel these issues have been discussed and it has been held that prior to 01.04.2011 the credit would be eligible. It is also to be pointed out that the invoices are issued in the name of the company and the cost of such services has ....
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....e invoices does not show the registration number of the service provider. The relevant discussion reads as under : "8. An amount of Rs. 1,82,432/- has been denied alleging that the invoice does not show the Registration number of the service provider. In the case of M/s. Imagination Technologies India Pvt. Ltd. (supra), the said issue has been held in favour of the assessee. Following the same, we hold that the Credit is admissible." 13.2. On the issue of non-furnishing of registration number, in the case of Mafatlal Industries Ltd. (supra), the Tribunal observed as under : "11. As regards the demand of Rs. 3,31,189/-, we find that Cenvat credit was denied only on the ground that in the invoices, certain services did not carry either Serial Number or Service Tax Registration. We find that this is a technical infraction and moreover this error is not on the part of the appellant but on the part of the service provider who issued the invoices. It is not a case of the department that in said invoices, no service tax was paid and there is no dispute about receipt and use of the services, which are the main criteria for allowing Cenvat credit on input service. Therefore, in our vie....
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....eby, name and address of the person receiving taxable service, description and classification of taxable service are not forthcoming on the invoice. The only basis this objection can be upheld is that photocopy submitted by the appellant cannot be relied upon. Unfortunately, the Assistant Commissioner does not even say that he has verified the original or photocopy. The Commissioners (Appeals) observes : "I find that adjudicating authority has convincingly established vide para 15 of the impugned order that the appellants have taken the credit of Service Tax on the basis of bill which is not a prescribed document and does not contain details as required under sub-rule (2) of Rule 9 of Cenvat Credit Rules, 2004...". Apparently the Commissioner (Appeals) is too busy to verify the invoice into deal with limitation also. It is strange that the original authority in para 16 of his order observes : "It is also noticed that the assessee have not indicated or produced any specific documents or records before me during the adjudication proceedings as evidence that the documents on which the issue in question was brought to the knowledge of department earlier. The assessee has therefor....
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....o the date of ISD registration was granted for the said unit. We find that Hon'ble High Court of Karnataka in the case of mPortal (I) Wireless Solutions (P) Limited v. CST, Bangalore - 2012 (27) S.T.R. 134 (Kar.) has considered the issue of ISD invoices issued prior to registration and held that for this reason Cenvat credit cannot be denied. The relevant portion of the order is reproduced as under :- "7. Insofar as requirement of registration with the department as a condition precedent for claiming Cenvat credit is concerned, Learned Counsel appearing for both parties were unable to point out any provision in the Cenvat Credit Rules which impose such restriction. In the absence of a statutory provision which prescribes that registration is mandatory and that if such a registration is not made the assessee is not entitled to the benefit of refund, the three authorities committed a serious error in rejecting the claim for refund on the ground which is not existence in law. Therefore, said finding recorded by the Tribunal as well as by the lower authorities cannot be sustained. Accordingly, it is set aside. 8. That does not mean that the assessee is entitled to refund as claimed....