TaxTMI 
TaxTMI 
2026 (2) TMI 15
X X X X Extracts X X X X
X X X X Extracts X X X X
....that the appellant had availed CENVAT Credit beyond the period of one year in violation of Rule 4 of CENVAT Credit Rules, 2004 read with Notification No.21/2014- CE(NT), dated 11.07.2014. 2.1. Accordingly, a Show Cause Notice dated 20.04.2017 was issued to the appellant demanding Service Tax allegedly short paid, along with interest and penalty. The notice also proposed disallowance of CENVAT Credit availed in violation of Rule 4 of CENVAT Credit Rules, 2004. 2.2. After due process, the said notice was adjudicated vide the impugned order wherein the ld. adjudicating authority has confirmed the demand on account of short payment of Service Tax and disallowed CENVAT Credit, to the extent as mentioned in the said impugned order. 2.3. Aggrieved by the confirmation of the demand of Service Tax and disallowance of CENVAT Credit, along with interest and penalty thereon, the appellant has filed the present appeal. 3. Regarding the demand of Service Tax amounting to Rs.9,08,617/- confirmed in the impugned order on import of service under 'Reverse Charge Mechanism' for the period 2011-12, the appellant's submission is that the demand is barred by limitation. They point out that t....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ervice Tax confirmed on the advances received. 5. Regarding the demand of Service Tax of Rs.86,69,562/- on account of alleged inadmissible CENVAT Credit on the ground of violation of Rule 4 of CENVAT Credit Rules, 2004 read with Notification No.21/2014-CE(NT), dated 11.07.2014, the appellant argues that during the period 2011-12 to 2014-15, the appellant has taken CENVAT Credit in the books of accounts. Furthermore, they submit that there is no dispute regarding eligibility of the CENVAT Credit, receipt of the input service and use towards provision of taxable service. It is their stand that claim of the CENVAT Credit in ST-3 return cannot be considered as a condition for availment of CENVAT Credit. It is stated in this regard that the ld. adjudicating authority has disallowed the credit on the basis of 3rd Proviso of Rule 4(1) of the CENVAT Credit Rules, 2004. To this extent, the appellant submits that the said proviso has been inserted in the CENVAT Credit Rules only w.e.f. 0109-2014 and such proviso is prospective not retrospective. Thus, it is the appellant's contention that the restriction of availing the credit within one year from the date of receipt of the invoice was no....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... ground of alleged violation of Rule 4 of CENVAT Credit Rules, 2004. 10. Regarding the demand of Service Tax amounting to Rs.9,08,617/- confirmed in the impugned order on 'import of service' under Reverse Charge Mechanism for the period 2011-12, we take note of the fact that the Show Cause Notice in this case was issued on 20.04.2017 by invoking the larger period of limitation. We also observe that the appellant have been paying Service Tax and filing returns regularly during the impugned period. The Show Cause Notice or the impugned order has failed to bring in any evidence to establish suppression of facts with the intention to evade the tax on the part of the appellant. Hence, we are of the view that the said demand confirmed, by invoking the extended period of limitation, is not sustainable. Further, we also find that this demand has been made under Reverse Charge Mechanism. Therefore, we agree with the submission of the appellant that they would be entitled to take CENVAT Credit on the very same amount on the very same day. In this context, we also note that it has been laid down in a catena of decisions that the allegation of suppression and demand beyond the normal period....
X X X X Extracts X X X X
X X X X Extracts X X X X
....r claim, the appellant has submitted a copy of the loan agreement, bank statement showing re-payment of the loan and CA certificate. The evidences submitted by the appellant clearly indicate that the advances received by the appellant from their Group companies and others were refunded along with interest. As it is clear that the advances received were not with respect provision of any taxable service, we hold that no Service Tax is payable on the same. In this context, we also observe that the said issue has already been settled in favour of the appellant by this Bench in appellants own group companies' case in Forum Projects Pvt. Ltd. v. Commissioner of Service Tax, Audit, Kolkata [Final Order No. 77576 of 2025, dated 28.10.2025 in Service Tax Appeal No. 75611 of 2017 - CESTAT, Kolkata]. The relevant observations of the Bench in the aforesaid case have been reproduced below for ease of reference: - "8.1. Regarding the service tax demand of Rs.2,22,51,053/- confirmed against the 'advance received', we find that the appellant submission is that the same were not 'advances' received for provision of any taxable service, but refundable loan amounts received from various part....
X X X X Extracts X X X X
X X X X Extracts X X X X
....us, we find that the restriction of availing the credit within one year from the date of receipt of the invoice was not in existence during the relevant period. Considering the above, we hold that the CENVAT Credit taken by the appellant during the period 201112 to 2013-14 was not covered under this proviso. Moreover, it is observed that there is no dispute regarding eligibility of the said CENVAT Credit, receipt of the input service or use of the same towards provision of taxable services. We also find that the CENVAT Credit amounting to Rs.23,62,960/- out of total Cenvat Credit Rs.23,75,756/- has been allowed by the ld. adjudicating authority. We find force in the appellant's stand that since the remaining credit has also been taken before coming into existence of the third proviso to Rule 4(1) of the CENVAT Credit rules, the denial of the said amount of CENVAT Credit is not justified. In view of the above discussions, we hold that the appellant is eligible for the above CENVAT Credit and accordingly, we set aside the disallowance of CENVAT Credit and recovery thereof as ordered vide in the impugned order. 13. The appellant has also contested the aspect of imposition of penalt....