2025 (12) TMI 1073

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....ESTAT Final Order No.40058/2016 dated 08.01.2016, wherein the Tribunal remanded the matter to the Adjudicating Authority for the limited extent of examining the allocation of credit of common input services to departments rendering taxable services and those rendering exempted services thereby to pass a reasoned and speaking order and ordered that there shall be no penalty on the Appellant in the remand proceedings. 2. Brief and relevant facts of the case are that Appellant is engaged in providing services such as online information and database access/retrieval, internet café, leased circuit, franchise, business auxiliary services, advertisement services etc. They also rendered non-taxable/exempt services such as software develop....

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....ondent, perused the records and the judicial precedents filed during the course of hearing. 5. The only issue that arises for our consideration is "whether cenvat credit of input services exclusively used for dutiable product should be taken or total cenvat credit of only common input service should be taken for the purpose of calculating the cenvat credit for reversal in terms of Rule 6(3A)" ?. 6. Facts are not in dispute; also, none of the parties has challenged the Final Order (supra) and hence, the same has become final. 7. In terms of Rule 6 (3) (ii) of CCR 2004, the manufacturer of goods or the provider of output service shall pay an amount equivalent to the CENVAT credit attributable to inputs and input services used in, or ....

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.... exempted goods are not allowed. That means input or input service used in taxable service/dutiable goods, Cenvat credit is allowed. Sub-rule (2) of Rule 6 is only as an option that if any input or input services used in exempted goods, credit should not be allowed and only with this intention some mechanisms for expunging Cenvat credit attributed only to the exempted goods are provided. As per clause (b)(ii) & (iv), it is clearly provided that entire credit in respect of receipt and use of inputs/input service is allowed when such input and input service is used in dutiable final products and taxable service. However, nowhere in Rule 6 it is provided that the input or input service used in dutiable goods shall not be allowed. The Revenue i....