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2025 (9) TMI 328
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.... (ii) I confirm the demand of Rs. 1,28,08,648/- (as per demand raised vide SCN dated 22-12-2015) along with applicable rate(s) of interest, under the provisions of under Rule 6(3) of the Cenvat Credit Rules read with Rule 14 of the said Rules and Section 1 1AA of the Central Excise Act, 1944. (iii) The amount of Rs. 38,82,360/- as also the amount of interest for Rs. 68,742/-, which have already been deposited by the said party, i.e., M's L.G. Electronics India Pvt. Ltd., Greater Noida, are ordered to b appropriated against the aforesaid demands. (iv) I impose penalty of Rs. 3,51,99,460/- on the party, i.e., M/s L.G Electronics India Pvt. Ltd., Greater Noida, under Rule 15(2) of the Cenvat Credit Rules, 2004 read with Section 11AC of the Central Excise Act, 1944." 2.1 Appellant is engaged in manufacture of Washing Machines, Air Conditioners, Refrigerators, Microwave-ovens etc. falling under Chapter 84 & 85 of the First Schedule to the Central Excise Tariff Act, 1985 (herein after referred to as the CETA) and are registered with the Central Excise & Service Tax, vide Registration Nos. AAACL1745QXM001 and AAACL1745QST003 respectively. They are availing t....
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....y used in respect of excisable and exempted goods. Prior to 01-04-2011, 6(5) of the CENVAT Credit Rules, 2004 provided that on Intellectual Property Services [Section 65 (105) (zzr) ] among one of the 17 specified services, credit was available unless such services were used exclusively in or in relation to manufacture of exempted goods or providing exempted services. After 01-04-2011 the Rule itself has been deleted/omitted by Notification No. 03/2011-CE(N.T) dated 01-03-2011, w.e.f. 01-04-2011. On enquiry appellant stated that Cenvat credit availed IPR services is Rs. 15,08,19,961/-. Since they did not maintain separate account of the common services for exempted and excisable products, an amount on to the tune of Rs. 1,28,08,648/- is to be reversed along with interest under Rule 6(3) of Cenvat Credit Rules, 2004. 2.6 A show cause notice for the period April 2011 to September, 2015 dated 22-12-2015 was issued to them to show cause as to why:- (i) Cenvat Credit amounting to Rs. 1,87,38,421/- taken and utilized by them should not be disallowed and recovered from them along with interest, as applicable thereon, under Rule 14 of CC Rules read with section 11A and section ....
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....We have considered the impugned order along with the submissions made in appeal and during the course of arguments. 4.2 Impugned order records findings as follows: "7.2 On perusal of the records of the both the case files, I find that in the instant matter two issues need determination :- i) Whether the Cenvat credit of construction services (inclusive of Erection & Installation services undertaken at their retail show rooms, Dealer, sub- dealer premises) termed as Brand-Shop Management under the garb of advertisement services was wrongly availed by the party in the light of the provisions of CC Rules, 2004? and ii) Whether Cenvat credit availed on Intellectual Property Rights (lPR) services was improperly distributed and wrongly availed by the party (at Noida plant) though such credit pertains to trading activities of the party ? 7.3 At first, I take up the issue of admissibility of credit on construction services (inclusive of erection and installation etc.) advertising expenses. In this context, observe hat para 3 of the Notice dated 22-12-2015 being the crux of the said Notice dated 22-12-2015. which read as under - a. Services of....
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....13-14/136 dated 17-08-2013 was for Rs. 2,59,3 18/- of M/s ASA Retail Solutions Pvt. Ltd., Plot No, 21, 12/6, Gurukul Industrial Area, Sector 38, Faridabad raised for 'Labour charges for installation of Brand-shop display stand.' It is evident that services have been rendered for installation of stand at Dealer/sub-dealers premises 7.4.5 Invoice No.HR/713/14-15 dated 21-10-2014 of M/s Next Step Engineering Pvt. Ltd. was raised for Rs. 3,40,750/- towards expenses for Erection, Commissioning or Installation services for Electronikrft done at B-4 Kanti Nagar Extension Jagatpuri, Main Road, Krishna Nagar Delhi -51. It is seen that the details available with the invoice were for the activities like providing items for display of goods like LCD/Plasma TV Display Panel, AC Display Panel Refrigerator Display Washing Machine Display, Microwave Display, GSM Gandola. Catalogue stand, Cash-zone-Counters, staff seating including table chairs, Podiums, Projector, Security Camera etc. at the premises of M/s Electronikraft, B-4, Kanti Nagar Extension, Jagatpuri main Road Krishna Nagar, Delhi-51. It is clearly seen that the above referred were activities and not services and, thus, ....
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.... A. Verification & submission of estimation quotation for job containing full details of cost of material as well as services to LGEIL after obtaining the same from the Contractors on a contract to contract basis. GIIR will be required to obtain estimation for the job from the contractor for each individual contract and submit the same to LGEIL 7.7 On going through the above extracts taken from above said Agreement for the work carried out at various places, it is worth to note that that entire work included 'construction work' and 'cost of material'. It clearly goes to understand that the bills were raised inclusive of the cost of materials used and also the work relating to civil nature (i.e., construction work). This position is sufficient to hold that the allegations as labeled in the instant notice at point nos. (i), (ii) & (iii) of para 3 of the instant Notice are correct to the extent that the bills raised for erection, commissioning and installation of goods as also retainer-ship meant for repair services on monthly or on annual basis. The said agreement is also able to evince that bills also included the cost of materials used while carrying out i....
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....n on inputs, or capital goods and outward transportation of up to the place of removal." 7.11 Here, it is worthwhile to observe that the provisions, as cited above, evince that impugned services are for activities rendered by the service providers or those consumed by the manufacturers of final product up to the place of removal. Such services were eligible either for an office relating to such factory or for the premises of a service provider. Undisputedly, the party has not contended that the place of removal in respect of their final products is not their factory gate. The services were performed beyond the factory gate. In other words, it means that the services of advertisement has no nexus with the completion of manufacture of final products. In the instant matter, the inclusion clause of Rule 2 of the CC Rules,2004, do not cover the incidences of services performed and utilized at a place other than the place of removal. In the instant matter, places of provision of services fall beyond the place of removal that is the factory gate of the party. 7.12 While deciding the said issue, I place reliance on the decision of the Hon'ble Tribunal in the case of K....
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.... of removal" defined in Section 4(3) (c) is the place of removal for the manufacture of the goods and in case, the manufacturer after clearing the goods from the factory to his tepots(clears) all the depots it is those depots which would be the place of removal. However, when the manufacturer clears the goods to the depots of some other persons, those depots cannot be treated as "Place of removal" for the manufacture, unless the sales are on FOR basis. For this reason also, the "Place of removal" in this case is factory of the appellant and the depot of M/ls Parle Biscuits. .. In view of this, we hold that the Cenvat Credit of the service tax paid on the GTA services availed for transportation goods from the factory of the appellant to the depot has been correctly denied and, as such, the Cenvat credit demand has been correctly up-held along with interest. 9. In view of the above discussion, we do not find any merit in the appeal. The same is dismissed." 7.13 I further observe that against the above detailed order of the Principal Bench, the appellant M/s Kohinoor Biscuit Products preferred an appeal before the Hon'ble Allahabad High Court. However, the appeal....
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.... the issue has been critically examined in respect of input services the case of Vikram Cement Vs. CCE Indore 2009(242) ELT 545, In the said case, the Tribunal held that the definition of input contains expressions 'used', 'in or in relation to' and "manufacture of final product and discloses that the same refer to products used in or integrally connected with the process of manufacture of final product. The term 'capital goods has been defined independently in the Rules, therefore if the inputs were to include every product under the sun which is somehow related to the premises wherc the manufacturing process is carried out then there is no need to provide a definition of the term capital goods. Relevant extracts of the verdict are reproduced below:- " 28. If one reads the decision of J.K. Cotton Spg. & Wvg. Mills Co. Ltd. case, it has been clearly held therein that the expression "in the manufacture of goods" should normally encompass the entire process carried on by the dealer of converting raw materials into finished goods. Where any particular process is so integrally connected with the ultimate production of goods that, but for that process, manuf....
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....e capital goods to be redundant as well as the provisions relating to extending the benefit of Cenvat credit to the capital goods." 7.16 I note that the above views of the Tribunal in the case of Vikram Cement case supra were later endorsed by the larger bench of the Tribunal in the case of Vandana Global (2010(253) ELT 440; where Hon'ble Tribunal held that in the case where cement and steel items used for laying foundation and building structural support and not used in the course of manufacture of final product, the same are not eligible for taking Cenvat, credit. Further. the decision also clarified that definition of inputs cannot be interpreted to include either capital goods or foundation and supporting structures for such capital goods. Para 44 of the said Judgement is reproduced below:- "44. Another argument is that even the main definition of input under Rule 2(k) would include cement and steel items used for laying foundation and making supporting structures as the expression used thereunder is wide and includes everything "used in or in relation to the manufacture" of final products whether directly or indirectly. The argument is that cement and ste....
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.... credit as input. Applying the ratio, I find that the activities of erection, commissioning and/or installation of items at the Dealers/sub-dealers premises do not have any nexus with the manufacturing activities undertaken at the factory. While making this observation, I refer to para 14 of the said decision :- " 14. In the case of Collector of Central Excise, New Delhi v. M/s. Ballarpur Industries Ltd. reported in (1989) 4 SCC 566 the difference between the expression "used in the manufacture" and "used as input (raw material)" was highlighted. In that judgment, it was held that undoubtedly the said two expressions are distinct and separate, but, when an ancillary process (like electricity generation) aids the making of an end product, then, the ancillary process gets integrally connected to the end product. In the said judgment, this Court applied what is called as "the dependence test". It may, however, be noted that in the definition of "input" the expression "used in or in relation to the manufacture of final product" is not a standalone item. It has to be read in entirety and when so read it reads as "used in or in relation to the manufacture of final product whethe....
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....final product. The intention of the Legislature is that inputs falling in the inclusive part must have nexus with the manufacture of the final product." On perusal of above observations, I find the ratio of the above case is applicable in the present matter for the purpose of determining nexus between input services and the manufacture of final products 7.18 On the question of inclusion clause of service of Brand shop management under Rule 2(1) of the CC Rules 2004, I rely on the case of Vikram Ispat Versus C.C.E., Raigad, 2009 (16) S.T.R. 195 ( Tri. Mumbai), while deciding the said case, Hon'ble Tribunal have held that input service should have nexus with manufacture of goods. Applying the same ratio, I find that the defence could not adduce any evidence to establish the nexus between installation, erection, commissioning activities performed at Dealers/Sub-dealers premises and the manufacturing activities undertaken at the factory. In this context, I find relevant to reproduced para 3, as below:- " 3. The learned counsel further refers to each of the four items on which the Cenvat credits in question were taken. He submits that these items are comin....
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....nput service' defined under Rule 2(l). It is within anybody's knowledge that a mobile phone can be used by a person for multifarious purposes. No doubt, a functionary/official/employee of the company could use it for purposes connected with the manufacture and/or clearance of the final products, but the assessee has failed to establish that the mobile phones in question were dedicated to this purpose. The learned counsel has referred to the Tribunal's Larger Bench decision in CCE, Mumbai-V v. GTC Industries Ltd. - 2008 (12) S.T.R. 468 (Tri.-LB), wherein outdoor catering services used for supply of food in a factory canteen were held to be input services. The learned counsel has cited the above decision in support of his submission that the definition of "input service" should be construed liberally. It is his submission that some of the items mentioned in the inclusive part of that definition are comparable to one or the other of the services in question and, therefore, it should be held that the latter are also covered by the definition of "input service". I do not agree. Any service to be brought within the ambit of definition of "input service" should be one which should specify....
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....der in this case. The Apex Court held that the hot mix plant which is specifically covered under Plant and Machinery Tariff Heading 8474 are manufactured and brought. The point decided by the Apex Court was whether setting up of such plant and machinery would amount to manufacture liable to Central Excise. First of all, in the present case we have no admitted capital goods brought for installation or erection in the desired site. The towers and their components cleared as angles and channels or as set of angles in CKD condition are cleared after duty payment by the manufacturer under Chapter 73, which is an excluded chapter for capital goods. As such, there is no movable capital goods which are otherwise eligible for Cenvat credit which are being denied such credit only applying the test of immovability. Tower Parts (MS Channels, Angles, etc.) as "Inputs" for availing credit :- An alternate claim has been made by the appellants to allow Cenvat credit paid on structural parts/towers/shelters treating them as inputs in terms of Rule 2(k)(ii) which allows credit of all goods used for providing output services. It was argued that there is no bar for goods which do not fall und....
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.... the present case the manipulation/fabrication of raw materials involved in erection and installation, fixing of towers and shelters will render such nexus tenuous. If the claim of the appellant is to be accepted, the credit can be even extended to duty paid MS Ingots if procured by the appellants to get the MS Angles manufactured which in turn used for erection of tower which in turn is used for providing telecom service. It is clear that such far remote linkages are not within the scope of the term "used for". 23. It is necessary to note that before infrastructure companies came into the picture, telecom operators themselves were putting up such infrastructure and using the same to provide telecom service. In other words, in the absence of infrastructure companies as an intermediary, telecom companies themselves created such infrastructure and "provided" such business support service to self. The issue of Service Tax liability in such situation on business support service is not raised because there are no two persons as a provider or recipient of such service. In a sense such service was to the self. Considering such factual matrix, we find that no distinction could be ....
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....es, 2004. In the context of considering a similar question in the case of Manikgarh Cement Work (supra), I held that a nexus should be established between the services in question and the manufacture/clearance of excisable goods by the assessee for claiming the benefit of Cenvat Credit of the service tax paid on such services. Paras 4 to 7 of the order passed in that case are reproduced below : "4. The Hon'ble High Court, in the case of Coca Cola (supra), examined the scope of the above definition. It held that the definition could be divided into five categories and that each category/limb of the definition could be considered as an independent benefit or concession/exemption. Their Lordships clarified that, if an assessee could satisfy any one of the five categories/limbs, credit of the service tax paid on the relevant services would be available to him. The assessee need not satisfy the other limb(s) of the definition. According to the ld. counsel, the question whether Cenvat credit of service tax paid on the aforesaid four services rendered at the residential colony outside the factory is admissible to the respondent is squarely covered by the Hon'ble High Court's deci....
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....e identity of the input is not contained in the final product then such an item would not qualify as input. In order to get over this controversy in the above definition of 'input', the Legislature has clarified that even if an item is not contained in the final product still it would be classifiable as an 'input' under the above definition. In other words, it has been clarified by the definition of 'input' that the following considerations will not be relevant : (a) use of input in the manufacturing process be it direct or indirect; (b) even if the input is not contained in the final product, it would still be covered by the definition. These considerations have been made irrelevant by the use of the expression "goods used in or in relation to the manufacture of final products" which, as stated above, is the crucial requirement of the definition of 'input'. Moreover, the said expression, viz, "used in or in relation to the manufacture of final products" in the specific/substantive part of the definition is so wide that it would cover innumerable items as 'input' and to avoid such contingency the Legislature has incorporated the inclusive part after the s....
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....nput service, the main part of the definition contains the quintessential ingredients and the inclusive part provides a non-exhaustive list of items each of which should satisfy the requirements of the main part. Ld. counsel has pointed out that, in the case of input, "place of use" is a third part of the definition, which is conspicuously absent in the definition of "input service". It has been argued that an input service need not necessarily be rendered within the factory premises whereas an input should normally be used within the factory. Broadly, this distinction sounds valid. But, again, it doesn't offer an answer to the question whether the service (which is rendered within the factory or outside) satisfies other essential requirements laid down in the main part of the definition. Even if it be held that there is no place of use in relation to input service, the basic requirement remains to be that anything mentioned as an input service in the inclusive part of the definition should be shown to have been used in or in relation to the manufacture or clearance of final products, whether directly or indirectly. 6. In the earlier cases of the same assessee, coord....
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....ed herein above, I conclude that the Cenvat credit taken in respect of the input services performed and consumed at the places like Dealers/ Sub-dealers premises in the name of Brand Shop Management were utilized beyond the place of removal and not up to the place of removal, and the credit attributable to said services was not admissible to the party. Accordingly, the demand of inadmissible credit on this account deserves to be confirmed along with consequence thereto 8. I now proceed to the other issue, i.e. the issue of admissibility of credit availed on IPR services having been distributed and availed/utilized wrongly by Greater Noida Plant despite being attributable to trading activities. 8.1 The case set up in the instant Notice, in nut-shell, inter alia, is that the notice party wrongly availed CENVAT credit of Service Tax attributable to trading activities in terms of Rule 7 of CC Rules-2004, as also informed and admitted by them vide their letters dated 29-10-2015 and 04-11-2015. The fact of application of Rule 7 over such credit is stated by the party itself in Annexure A to both the said letters (RUDs 5, 4). The fact of applicability of rule 7 of CC Rul....
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....made following submissions in this regard:- (i) Technical-know-how received is used in both the manufacturing operation as well for testing and maintaining quality of the product. (ii) It is also used for marketing and sale of the goods manufactured by them (iii) The technical knowhow is consumed by the party as and when received for manufacture of the products either at their end or at the end of various EMSs. (iv) Technical know-how received and used by them as well as by their EMS will not negate the fact that the said technology was used by the party itself. (v) There is no one to one co-relation required between the IPR service received by them and the products and manufactured by party itself or by their EMSs. (vi) The cost for such IPR service is borne by the party even though the same is based on the sale price of the product 8.5 The above submissions, in my view, are not sufficient to establish the eligibility of input service credit which have been found to be attributable towards the trading activities. Moreover, although a number of case laws have been cited by the party regarding admissibility of Cenvat cre....
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....tivity for the period prior to February, 2013 was not paid back. The defence submissions are not clear on this score. The party has neither reversed the credit nor explained the reason for not reversing the said credit for the period prior to February 2013. I find no cogent reason for a differential treatment to the issue of reversal of credit to the period prior to February 2013 and as such it leaves no room for doubt that the said credit taken in respect of trading activity is also liable to be reversed by the party. In the case of Pune Unit, they focused their defence to stress upon the admissibility of Cenvat Credit on I.P.R. services in respect of the S.C.N. dated 02-07-2015 issued by the Pune Commissionerate. However, unlike Pune Commissionerate case, this is not the issue in the instant case. I recall that the moot issue in the present case pertains to wrong availment of Cenvat credit attributable to trading activities. Admissibility of Cenvat Credit on I.P.R. Services to the extent of eligible share of Greater Noida Unit amongst the three segments, i.e. the Pune Unit, the Greater Noida and the trading activity in terms of Rule 7 of was never in dispute. Therefore, the pleas....
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....te account of the common services for exempted and excisable products, an amount to the tune of Rs. 122,95,899/- is to be reversed along with interest under Rule 6 (3) of Cenvat Credit Rules, 2004 as calculated at Annexure-III. 8.13 Here, it is worth observing that Rule 7 of CENVAT Credit Rules, 2004, prescribes manner of distribution of credit by input service distributor' and the said provision fairly comes into play in the instant matter. It stipulates that "The input service distributor may distribute the CENVAT Credit in respect of the service tax paid on the input service to its manufacturing units or units providing output service subject to the following conditions, namely :- (a) The credit distributed against a document referred to in rule 9 does not exceed the amount of service the tax paid thereon; (b) Credit of service tax attributable to service (used by one or more units) exclusively engaged in manufacture of exempted goods or providing of exempted services shall not be distributed; (c) Credit of service tax attributable to service (used wholly by a unit) shall be distributed only to that unit (d) Credit of ser....
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.... departmental Audit para (2) to the effect and that they reversed/paid back the credit in respect of inadmissible input service credit relating to trading activities. 8.18 Furthermore, the said party vide their letter dated 29-10-2015 ( RUD 5) has stated that "Further we like to inform you that we having centralized Registration of service tax for all business location at Noida and also registered ourselves as a "input service Distributor" in which credit of services is being taken in ISD books and thereafter credit of input services is being distributed to different unit, i.e. Noida factory, Pune Factory and unit providing output services as per the provision of rule-7 of Cenvat Credit Rule 2004" 8.19 Here, it is relevant to mention that the party wrongly availed/taken credit and utilized towards the trading activity for the period under demands. This is crystal clear from the admitted fact that the rule 7 was applicable in their matter. From the to RUD 5 as also Annexure N to RUD 6, it facts as found mentioned in annexure F IS abundantly clear that though the party had admitted the application of rule 7, ibid. and had themselves quantified the amount attributabl....
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....m the fact the party was admitting role of Rule 7 of CC Rules, however, they did not agree to the audit objection by not reversing the same though the same was wrongly availed as per rule 7 of the said Rules. Details of Reversal of Cenvat Credit ob IPR from Feb 13 to Jan. 14 Month Total Cenvat Credit on IP'R from Ech-13 to lan.11 Reversal % as Per Rule 7 Reversal Cenvat Credit 2013 Feb. 4375875 7,26% 317688 2013-03 7190552 7.26% 522034 2013-04 7191200 6.12% A61960 2013-05 7245438 7.13% 5168 10 2013-06 4693711 6.78% 318031 2013-07 3734322 6.25% 233527 2013-08 3097730 6.01% 186174 2013-09 3850463 5.22% 201089 2013-10 6156751 6.34% 3906IS 2013-11 2088043 7.66% 236539 2013-12 2657929 7.04%a 187079 2014-01 4443919 6.99% 310813 Total 57725932 3882360 8.23 However, at this juncture, I deem it proper to make a summary of the entire data relating to taking and distribution of Cenvat Credit on subject services by the party for the sake of bringing explicitly on the topic SUMMARY OF CENVAT ....
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....lity of input service credit involved on IPR service has been contended by the party. But, the fact of the matter is that the eligibility of IPR service for availing credit has not at all been the subject matter of the SCN. The issue related to applicability of Rule 7 of the CC Rules for availing credit on trading was the moot point alone. 8.26 I observe that the issue relating to admissibility of input service Credit for trading activity has been discussed at length by the Hon'ble High Court Bombay in the case of Mercedes Benz India Pvt. Ltd. Vs Commissioner of C.Ex. Pune-I [2016 (41) S.T.R.577 (Bom.)] and also by the Hon'ble Tribunal in the case of Orion Appliances Ltd Vs Commissioner of Service Tax, Ahmedabad [2010 (19) STR 205 (Tri.- Ahmd)]. Here also in the instant matter, I find that notice party too have admitted that amount of credit of input service involved on IPR service was not attributable to the extent of trading activities which they themselves worked out and out of such admitted amount they have reversed an amount of Rs. 38,82,360/- along with interest of Rs. 68,742/- as per their letter dated 04-11-2015 discussed herein before 8.27 Another....
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....services referred in Rule 6(5) of Cenvat Credit Rules, 2004 for whole of the credit attributable to dutiable as well as final exempted products and for taxable or exempted services but the assessee is not entitled to take Cenvat credit attributable to the activity of trading as during the relevant time, the trading activity was neither excisable nor an exempted service at all. Therefore, the quantification of inadmissible Cenvat credit is required to be done at the end of adjudicating authority to disallow the Cenvat credit attributable to trading activity. 8.2 The next issue is that whether the learned Commissioner has jurisdiction to reallocate the Cenvat credit or not. We have gone through the show cause notice wherein the allegation is that the assessee is not entitled to take Cenvat credit referred under Rule 6(5) of Cenvat Credit Rules, 2004 as the same are not covered in Rule 7. Therefore we hold that the learned Commissioner has no jurisdiction to reallocate the Cenvat credit to the assessee in question as there was no such allegation in the show cause notice and he cannot go beyond the allegation in the show cause notice to decide the issue. 8.3 We furthe....
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....02/16-17 Dated 14-06-2016 and since no notice of appeal against the said Order-in-original has been received by them till then, the same seems to have been accepted, and, accordingly, the present SCNs on this issue should also be dropped 10.1 With regard to above contention, it is pertinent to note that there were two different things happened in respect of Pune Unit. There was affirmation of fact by one Sh. Vipin Gupta, Production Engineer, to the effect that "there is no technology which is exclusively used for EMS production only in as-much-as the technology platform is almost same for the single product whereas there could be multiple variants on account of colour, size etc. in a particular product category 10.2 Secondly the said affirmation of facts by way of affidavit dated 04-04-2016 were placed reliance on the statement given by the Chartered Engineer's Certificate dated 04-05-2016, which according to him technically substantiated his statement. 10.3 I observe that the issue involved in the case considered by Pune 10.3 whether 1.P.R services had not been used for manufacture Commissionerate was of goods in the Pune Unit else by their Vendors/E....
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....l provisions contained in the instant notices are concerned, it is seen that the facts and circumstances as described herein before, it has been found that the credit of input services was not rightly availed and found to be wrongly availed and utilized, therefore consequences thereto, i.e. penal provisions suo moto follow. I further note that in the absence of any material change in the facts of the case for subsequent period, the findings given above are also applicable for the Statement of Demand issued on 18-10-2016 and the same, accordingly, stands disposed of vide this order." 4.3 We have gone through the entire contents of the impugned order and have reproduced the same for the simple reason that order in our view fail to consider the issues in proper perspective. There are basically two issues involved in the matter which have been reproduced in the para 7.2 of the impugned order. 4.4 On the first issue we observe that appellant has availed CENVAT Credit in respect of certain services which have been received by them at their depot-Brand Shop. Undisputedly these credits are in respect of the erection commissioning and installation services received by them at th....
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....n will be common to the price at the gate and at the depots outside the gate - because of the equalisation, the price will equally be uniform at the gate as well as at the depots. This aspect will become clearer once we deal with the permissibility of the deductions claimed. 26. With respect to the alternative argument of Sri Nariman, we must say that no direction can be given to the authorities to adopt the price at which the assessee sells its goods to the Government as the price in respect of its total sales. Firstly, by virtue of proviso (i) to Section 4(1)(a), the Government would be a class by itself and the price charged to it would be relevant only to the goods sold to it. So far as depot sales are concerned, they are to a different class or classes of buyers and in respect of the goods sold to them, the price charged to each of such class of buyers would be the normal price. The price charged to one class of buyers cannot, therefore, be directed to be adopted as the price in respect of all the classes of buyers. Since the position under the old Section 4 and new Section 4 is held to be the same, this holding holds good for both periods. 27. For the above ....
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.... "In the first place, we intend to address the controversy as to whether in case of clearance under Section 4A, the Depot can be considered as 'a place of removal'? In this regard, we find that the C.B.E. & C., vide letter No. 137/3/200-C.X, dated 2-2-2006, inter alia, had clarified as under : In view of the above, the '4. undersigned is directed to state that, in case of depot sales of goods, the credit of Service Tax paid on the transportation of goods up to such depot would be eligible, irrespective of the fact, whether the goods were chargeable to excise duty at specific rates or ad valorem rates on the basis of valuation under Section 4 or 4A of the Central Excise Act.' This being the case, there should not be any doubt that eligible services availed upto the Depot/RDCs by the appellant in this case would be eligible for availment of input service credit." 18. The issue, which should have been decided by the Adjudicating Authority, is as to whether the point of sale is the RDC as contended by the assessee. In fact, the Tribunal partly allowed the assessee's appeals on input service credit availed in all the RDCs in respect of renting of p....
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....bulk form and packed bags and during the period from January, 2010 to June, 2010 and availed CENVAT credit of Service Tax paid on outward transportation of goods through a transport agency from their premises to the customer's premises and on the said facts, it was held that the CENVAT credit was not admissible to the assessee for such transport. The decision came to be rendered on considering amendment to the CCR namely Rule 2(l) as effective from 1-3-2008. The decision does not overturn the earlier decision in the case of Vasavadatta Cements Ltd. However, the Tribunal did not endeavour to go into the factual matrix of the case, but applied the decision in the case of Ultra Tech Cement Ltd., and negatived the stand taken by the assessee. 21. It has to be noted that for the period prior to 1-4-2008, the Hon'ble Supreme Court, in the case of Vasavadatta Cements Ltd., held that the tax paid on the transportation of final product from the place of removal upto the first point, whether it is the depot or the customer, has to be allowed and we find that the issue addressed by the Hon'ble Supreme Court in the decision in the case of Ultra Tech Cement Ltd., pertains to the fi....
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.... in the impugned order is that the appellant was receiving IPR Services from their principals in South Korea and paying the service tax due on the same on reverse charge basis. The said services were common input services both exempted trading services and for sale of the goods subjected to excise duty. The issue in the present case is not vis a vis the admissibility of CENVAT Credit in respect of the said service. The demand has been made for recovery of the amount to be reversed in terms of Rule 6 (3) of the CENVAT Credit Rules, 2004. Appellant have admitted and have reversed the amount due for the period February 2013 to January 2014, along with the interest. Impugned order records the said admission and proceeds to demand for the remaining period of demand i.e. for the period April 2011 to January 2013. 4.8 The order in original No PUN-EXCUS-004-COM-02/16-17 dated 14.06.2016 of Commissioner Central Excise Pune, is with regards to the admissibility of the CENVAT Credit in respect of the IPR services and do not decide the issue in hand and hence cannot have any precedence or persuasive value. 4.9 In the impugned order or in the show cause notice no specific reason has been ....
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....ontravention of any provision is not sufficient to attract the extended period of limitation." [Emphasis supplied] 18. We are in complete agreement with the principle enunciated in the above decisions, in light of the proviso to Section 11A of the Central Excise Act, 1944. However, before extending it to the Act, we would like to point out the niceties that separate the analogous provisions of the two, an issue which received the indulgence of this Court in Associated Cement Companies Ltd. v. Commissioner of Customs - (2001) 4 SCC 593, at page 619 = 2001 (128) E.L.T. 21 (S.C.) in the following words :- "53... Our attention was drawn to the cases of CCE v. Chemphar Drugs and Liniments - (1989) 2 SCC 127, Cosmic Dye Chemical v. CCE - (1995) 6 SCC 117, Padmini Products v. CCE - (1989) 4 SCC 275, T.N. Housing Board v. CCE - 1995 Supp (1) SCC 50 and CCE v. H.M.M. Ltd. (supra). In all these cases the Court was concerned with the applicability of the proviso to Section 11-A of the Central Excise Act which, like in the case of the Customs Act, contemplated the increase in the period of limitation for issuing a show-cause notice in the case of non-levy or short-le....
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....r, his agent or employee. Even if both the expressions "misstatement" and "suppression of facts" are to be qualified by the word "wilful", as was done in the Cosmic Dye Chemical case while construing the proviso to Section 11-A, the making of such a wilful misstatement or suppression of facts would attract the provisions of Section 28 of the Customs Act. In each of these appeals it will have to be seen as a fact whether there has been a non-levy or short-levy and whether that has been by reason of collusion or any wilful misstatement or suppression of facts by the importer or his agent or employee." [Emphasis supplied] 19. Thus, Section 28 of the Act clearly contemplates two situations, viz. inadvertent non-payment and deliberate default. The former is canvassed in the main body of Section 28 of the Act and is met with a limitation period of six months, whereas the latter, finds abode in the proviso to the section and faces a limitation period of five years. For the operation of the proviso, the intention to deliberately default is a mandatory prerequisite. ..... 24. Further, we are not convinced with the finding of the Tribunal which placed the onus o....