TaxTMI 
TaxTMI 
2024 (5) TMI 328
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....t voluntarily paid an amount of Rs. 23,04,355/- as short payment on account of the credit taken erroneously on common input services and Rs. 3,98,281/- as interest. However, alleging that the amount paid by appellant was short payment of service tax which occurred due to utilisation of ineligible CENVAT credit, demand was made for the period from May 2006 to March, 2010. Further it is alleged that for the period from 2011 to 2013, appellant has not exercised any option by intimating in writing to the Jurisdiction Range officer as per Rule 6 of CCR, 2004, reversal of Cenvat credit was also proposed. Based on the above allegation, a Show cause Notice was issued and the Adjudicating authority vide the impugned orders confirmed the demands for the period from May 2006 to 31st March, 2011. Aggrieved by the said order, appellant filed appeal as per details tabulated as under:- Sl No Central Excise Appeal No. Period SCN No. OIO No. Demand (in Rs.) 1. ST/1252/2010 May 2006- March 2008 63/2009-ST 16/2010/ST dated 15.03.2010 5,17,85,203 2. ST/1721/2011 FY 2008 - 2009 156/2009-ST 05/2011/ST dated 16.03.2011 5,36,75,447 3. ST/1700/2012 FY 2009- 2010 03/2011-ST 10/2012/ST....
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....unts or other documents produced by the assessee to enter into a finding that separate accounts are maintained by them, but simply relied on the certificate issued by the Chartered Accountant blindly and also relying on the original order passed by the Commissioner in respect of the assessee for the year 1.4.2011 to 31.3.2012 allowed the appeal. The said finding ought not to have been entered by the Tribunal without going into the records as done by the Commissioner for the period 2011 to 2012. In view of the above, we are of the considered opinion that the order of the Tribunal has to be set aside and matters are sent back to the Tribunal for fresh consideration. In the result, the Appeals are allowed and the impugned orders are set aside and the matter is remitted to the Tribunal for fresh consideration in accordance with law, within a period of four months from the date of receipt of a certified copy of this judgment. It is open to the respondent herein to establish its claim on the facts-in-issue between the parties under Section 129C sub section (7) of the Customs Act ". 6. Following the direction of the Hon'ble High Court of Kerala, the appeals were posted for hearing on 09.....
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....hat appellant is maintaining separate accounts in terms of Rule 6 (2) of Cenvat Credit Rules, 2004. 8. Learned Counsel for the appellant further submits that as per the ibid order, the respondent had concluded that "Cenvat Credit Rules, 2004 do not stipulate any specific format for maintenance of separate accounts of input services used for providing taxable and exempted services. In the absence of specific formats prescribed by the Department for maintenance of separate accounts in such cases, it is felt that the records including computerized data maintained by the Assessee are to be accepted. As the documents on record and the verification report of the Range Officer corroborate the submissions of the assessee regarding the maintenance of separate accounts and availment of Cenvat Credit, I have no hesitation in holding that the assessee has complied with the provisions of Cenvat Credit Rules, 2004 and the demand raised in the show cause notice is not sustainable." Learned Counsel further submits that the issue attained finality, since the said finding was upheld by this Tribunal as well as Hon'ble High Court of Kerala in CE appeal No. 4/2019. 9. Learned Counsel also drew our a....
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....g both taxable and exempted services. Rule 6(3) states that if Rule 6(1) or 6(2) are not fulfilled then an amount of 5% or 6% of the value of the exempted services shall be paid. These options are available to the assessee and it is open to the assessee to choose any of the options. It is not open to the Revenue to choose one of the options and force it upon the assessee. If the obligation is not fulfilled under any of the options, the irregularly availed CENVAT credit can be recovered under Rule 14 of CCR. 11. Learned Counsel further drew our attention to the Final Order in the matter of M/s. E-Connect Solutions (P) Ltd. Vs. Central Excise And Central Goods & Service Tax, Udaipur (2020(11)TMI 282-CESTAT, New Delhi) wherein it is held that : - 16. Rule 6(1) of the Rules curtails the service provider from availing CENVAT credit on input services used for exempted services. This clearly means that credit is allowed to be taken only on input services pertaining to taxable services. In other words, wherever exempted services are rendered, the credit pertaining to such exempted service is not admissible and is required to be reversed. Rule 6(2) provides that wherever exempted service....
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.... by Sri S. Ravi, Learned Senior Counsel, if the petitioner did not abide by the provisions of Rule 6(3) of the Cenvat Credit Rules, 2004, It was open to the authorities to reject its claim as regards the disputed Cenvat Credit of Rs.17,15,489/-. 15. We may also note that in the event the petitioner was found to have availed Cenvat Credit wrongly, Rule 14 of the Cenvat Credit Rules, 2004 empowered the authorities to recover such credit which had been taken or utilised wrongly along with interest. However, the second respondent did not choose to exercise power under this Rule but relied upon Rule 6(3)(1) and made the choice of the option thereunder for the petitioner, viz., to pay 5% or 6% of the value of the exempted services. The statutory scheme did not vest the second respondent with the power of making such a choice on behalf of the petitioner. The Order-in-Original, to the extent that it proceeded on these lines, therefore cannot be countenanced. Learned Counsel also draw our attention to large number of judgments and submits that the impugned order is unsustainable." 13. Learned Authorised Representative (AR) submits that for the period after 04/2008, the appellant has no....
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....eviable on excisable goods could avail the benefit of Notification granting exemption from Central Excise duty on a condition that the goods under assessment should follow Chapter X procedure prescribed under Central Excise Act and rules made thereunder. The Supreme Court held that the imported goods cannot be denied the exemption where the importer is able to establish the use of the imported goods for the prescribed purpose by any other mean or evidence. In Lakshmiratan Engineering Works v. Assistant Commissioner (Judicial) - 1968 (21) STC 154 (SC) = AIR 1968 SC 488, the proviso to Section 9 of the UP-Sales Tax Act provided that no appeal against an assessment shall be entertained unless it is accompanied by satisfactory proof of payment of the amount of tax admitted by the appellant to be due. Rule 66 (2) of the UP Sales Tax Rules provided that the memorandum of appeal shall be accompanied by the challan showing deposit in the treasury of the admitted tax. Before the Supreme Court it was contended that rule 66(2) provided the only mode of proving that the admitted tax has been deposited. The Supreme Court held that the words of the proviso to Section 9 were general; all that the....
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....isions of Rule 6(3) and accordingly to which, they are entitled to utilise only 20% of amount of service tax payable on taxable output service. 15. Heard both sides. We have also perused the documents and report submitted by Range officer, which was confirmed by the Range officer during his examination. 16. The issue on hand can be analysed separately for two periods (a) upto March 2008 and (b) after April 2008, when Rule 6 of CCR, 2004 was amended. (a) For the period upto March 2008, there was no provision for proportionate reversal of the credit already taken and if entire credit is availed, they could utilise only 20% of the output tax of a month through cenvat credit. (b) For the period after April 2008, a procedure has been prescribed under Rule 6(3A) to provisionally reverse the credit every month based on a calculation/ formula prescribed therein and to finally pay difference in reversal after completion of annual calculation by 30th June of the succeeding year. 17. In these cases, in order to avail Cenvat credit on common inputs, appellant was required to follow the procedures prescribed under Rule 6 of Cenvat Credit Rules, wherein it is stipulated to maintain separa....
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....ed by the Appellant. Range Officer further reports that appellant's claim for maintaining accounts/ records for exempted and non-exempted services is in order. Further, from the finding of the Respondent in Appellant's own case for the period from 2011 to 2012, which was upheld by Hon'ble High Court of Kerala, in the absence of specific formats prescribed by the Department for maintenance of separate accounts for providing taxable and exempted services in Cenvat credit Rules, 2004, if form the records including computerized data maintained by the appellant it is possible to retrieve the data as required to find out the input/ input services for both exempted and taxable service, it is sufficient to prove that the Appellant has maintained separate accounts as contemplated under Rule 6(2) of CCR, 2004. 20. Thus on a combined reading of the report of Range officer, findings of the Adjudication authority as stated above and considering the report of Chartered Accountant(CA), which categorically certified that the appellant is maintaining separate records and have been making reversal of balance amounts at end of every month, we find that the appellant has complied with the provisions ....