2023 (12) TMI 310

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....ut services and capital goods under the Cenvat Credit Rules, 2004 (hereinafter referred to as CCR,2004). 2. The Department while scrutiny of appellant's records for the year 2014-15 to June,2017, observed that they have shown an amount of Rs.29,57,753/- as miscellaneous income and receipts under head the "balance written back" in the balance sheet of 2016-17. From further enquiry of ledger, the department found that the appellant has write off above said payable amount to their debtors/vendor of contract drill. Department formed an opinion that the appellants have tolerated the situation and thus are covered under the ambit and scope of declared service as provided under section 66E (e) of the Finance Act, 1994. Resultantly, vide show caus....

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.... to Rs.29,57,753/-. The written back entries were duly in view of the provision towards the performance deduction charges. It is further submitted that from no stretch of imagination, it can be alleged that appellant has tolerated any act. Thus, the show cause notice has invoked a wrong provision. Though it is not the case of act or tolerance, it which is classified as declared service under section 66E (e) of the Finance Act, 1994, even if it had been the tolerance, it would have been on part of the receiver of machines supplied by the appellant. Seen from all of the above submissions, the demand under question is liable to be set aside. No question for imposition of penalty at all arises for want of any malafide intent on the part of the ....

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....the standard committed performance then Noticee would have liable to pay for such under performance of supplied machines. 7. Perusal of this clause in light of other clauses of the agreement makes it clear that the appellant was supposed to write off 20% of the value of machine received by them, after one year of the supply, to their vendors in case the machines perform subdued as per standard committed performance. In light of this provision, the appellant agreed its liability to compensate the receiver of machine in case receiver notices any lacuna in the performance of supplied machine within one year thereof. The appellant thus had made provision for the probable future liability towards the supplied machines. The appellant was showing....