TaxTMI 
TaxTMI 
2023 (2) TMI 1404
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....interest, the same should be treated as full discharge of tax liability. They relied on the case of Rathi Daga vs. CCENasik, 2015 (38) STR.213 (Tri-Mum). In respect of the demand on account of Service Tax under RCM basis, they paid the entire demand amount of Rs. 1,32,132/- along with interest of Rs. 83,686/-.They also submitted that the demand is time barred as there is no suppression on their part. 2. The Adjudicating Authority after following the due process confirmed the demand of Rs. 15,86,088/- in respect of Cenvat Credit to be reversed for the input services used as common inputs. He appropriated Rs. 5,91,787/- paid along with interest of Rs. 3,05,179/-. In respect of demand of Service Tax on RCM basis, he has appropriated Rs. 1,32,132/- along with interest of Rs. 83,686/- paid by the Appellant. He imposed penalty of Rs. 15,86,088/- and Rs. 1,32,132/- under Section 78 of the Finance Act, 1994. On appeal, the Commissioner (Appeals) rejected the same. Hence, the Appellant is before the Tribunal. 3. The Ld. Advocate appearing on behalf of the Appellant submits that after being pointed out by the Department they have reversed the Cevat Credit of Rs. 5,91,787/- along with inter....
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.... the period under consideration, the Tribunals have been taking a liberal view that on account of the mistake of non-filing of the option letter which is only a procedural condition, the assessee should not be made to suffer by making huge payments in terms of 5%/6% of the value of the exempted services. In the case of Mercedes Benz India (P) Ltd. Vs. CCE-Pune, 2015 (40) STR 381 (Tri.-Mum.), Mumbai Tribunal has held as under:- 5.4 We find that the appellant admittedly paid an amount of Rs. 4,06,785/- plus interest, this is not under dispute. Therefore in our view, the appellant have complied with the condition prescribed under Rule 6(3)(ii) read with sub-rule (3A) of Rule 6 of Cenvat Credit Rules, therefore demand of huge amount of Rs. 24,71,93,529/- of the total value of the vehicle amounting to. Rs. 494,38,70,577/- sold in the market cannot be demanded. We are also of the view that Rule 6 of the Cenvat Credit Rules is not enacted to extract illegal amount from the assessee. The main objective of the Rule 6 is to ensure that the assessee should not avail the Cenvat Credit in respect of input or input services which are used in or in relation to the manufacture of the exempted go....
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....Notification No. 10/2008- C.E. (N.T.), dated 1-3-2008 w.e.f. 1-4-2008. As per the new Rule, the manufacturer/service provider opting not to maintain separate account has to follow either of the following two options :- (a) a manufacturer shall pay 10% (5% w.e.f. 7-7-2009) of sale price of the exempted goods and an output service provider shall pay 8% (6% w.e.f. 7-7-2009) of the value of the exempted services; or (b) reverse the credit on inputs and input services pertaining to exempted goods and exempted services as per the procedure and conditions prescribed in Rule 6(3A), and it also prescribes the formula for calculation of the proportionate credit to be reversed. 6. For better appreciation, relevant part of Rule 6(3A) is reproduced as under :- Rule 6(3A). For determination and payment of amount payable under Clause (ii) of sub-rule (3), the manufacturer of goods or the provider of output service shall follow the following procedure and conditions, namely :- (a) while exercising this option, the manufacturer of goods or the provider of output service shall intimate in writing to the Superintendent of Central Excise giving the following particulars, namely :- (i) name....
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....Bang.) = 2011 (22) S.T.R. 484 (Tribunal)], it has been held that the condition in Rule 6(3A) to intimate the department is only a procedural one and that such procedural lapse is condonable and denial of substantive right for such procedural failure is unjustified. Taking into account the facts, evidence and following the precedents cited above, I am of the view that the demand raised is not legal and proper. 9. In the case of Cranes & Structural Engineers, V. CCE-Bangalore-I, 2017 (347) E. L. T. 112 (Tri.-Bang.), Bangalore Tribunal has held as under:- 4.1 On analysis of Rule 6(3A), I find that while exercising the option, the manufacturer of goods or the provider of output service shall intimate in writing to the Department regarding the option exercised. In the present case, admittedly there is no intimation given by the appellant informing the exercise of his option. The argument 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 calculating under the first option. According to me, this argument is devoid of merit, because the said Rule does not say anywhere that on failure to intimate, the m....