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TaxTMI 
TaxTMI 
TaxTMI 
2024 (6) TMI 507
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....n providing "stock broking service" to their clients. The appellant also undertakes self-trading. Therefore, they maintained two separate sets of books of account by using two separate softwares for recording income and expenses accordingly. All the expenses pertaining to each vertical, stock broking and self-trading are recorded in their respective books of account. The taxes charged on input services availed in respect of stock broking services are taken as cenvat credit by the appellant whereas no cenvat credit was availed in respect of input services related to self-trading. The major expense incurred by the appellant is of transaction charge which is recognized as expense in both the sets of accounts. The taxes charged limited to....
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....ices i.e. rent, banking, telephone, repair & maintenance, insurance, postage & courier, audit fees, internet broadband services, professional fee, software charges etc. These input services are used for providing output services, which are chargeable to tax as well as exempted services. During the said period, the appellant did not maintain separate account for receipt and use of input services for provision of such exempted service and for provision of taxable output service. Accordingly, in terms of Rule 6 (3) of the Cenvat Credit Rules, 2004, they are required to pay 5%/6% of the value of exempted services. 2.5 In these set of facts, two show-cause notices were issued to the appellant for payment of amount equal to 5%/6% of the value of....
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....he separate accounts is not maintained. It is his submission that as the proportionate cenvat credit has already been reversed by the appellant, the same shall be deemed as the appellant has not availed cenvat credit on exempted services. In that circumstances, no demand is sustainable against the appellant on account of non-maintenance of separate account in terms of Rule 6 (3) of the Cenvat Credit Rule, 2004. He further submits that as the CERA audit was conducted and the discrepancy has been pointed out, the first show-cause notice was not required to be issued by extending period of limitation, accordingly, the same is not sustainable. 4. On the other hand, the ld.A.R. for the Revenue supported the impugned order and submitted that it ....
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....3-14." As the fact of proportionate reversal of cenvat credit is on record and no credence was done by the adjudicating authority to the said fact, therefore, the impugned order is not sustainable in the eyes of law. 8. Further, we find that as the appellant has already reversed the proportionate cenvat credit attributable to exempted services, in that circumstances, the appellant is not required to pay any amount equal to 5%/6% of the value of the exempted services. The same view has been taken by this Tribunal in the case of M/s Chryso India Private Limied Vs. Commissioner of CGST & Central Excise, Kolkata North reported in 2023 (5) TMI 596-CESTAT-Kolkata, wherein this Tribunal has observed as under : "7. Admittedly the Appellant has....
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....ntimation given by the appellant informing his exercise of option. The contention of the department is that when the appellant has not intimated his option in writing then the appellant is bound to pay the duty amount calculated under the first option. I am afraid I cannot endorse this contention. The said rule does not say that on failure to intimate, the manufacturer/service provider would lose his choice to avail second option of reversing the proportionate credit. Rule 6(3A), as seen expressly stated is nothing but a procedure contemplated for application of Rule 6(3). Therefore, the argument of the Revenue that the requirement to intimate the department about the option exercised, is mandatory and that on failure, the appellant has no ....
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.... for application of Rule 6(3). Consequently, the argument of Revenue is that the appellants exercising option is mandatory and on its failure, the appellant has no other option but to accept and apply Rule 6(3)(i) and make payment of 5%/10% of the sale price of the exempted goods or exempted services is not acceptable, because the Rule does not lay down any such restriction and this has been held in the judgments cited supra. [emphasis supplied] 10. From the above decisions of the Tribunals, it is seen that even prior to Rule 6 (3AA) coming into effect from 01/4/2016, they have been taking the view that mere non filing of the option letter should not be used to deprive the assesssee from reversing the proportionate Cenvat Credit. The ver....