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2014 (8) TMI 98 - CESTAT AHMEDABADCenvat Credit - Extended period of limitation - provided taxable and non-taxable services both - reversal of credit under Rule 6 of CCR, 2004 - appellant has used the entire Cenvat Credit for discharge of the service tax liability on the output services during the period October 2004 to September 2007; wherein during the period they were supposed to use only 20% of the amount of the Cenvat Credit. - Held that:- appellant has contravened the provisions of the Cenvat Credit Rules, 2004 - the amount of ₹ 51,85,498/- paid by the appellant through PLA / cash is over and above the same amount which has been debited by them during the period October 2004 to September 2007 in their Cenvat Credit account. - lower authorities directed to allow the appellant to avail Cenvat Credit of an amount of ₹ 51,85,498/- as appellant has made good the said amount by paying it in cash. Levy of penalty - waiver of penalty u/s 80 - Held that:- appellant could not be charged with intentional evasion of service tax liability by utilizing excess amount of the Cenvat Credit for discharging service tax liability, in as much that there is no dispute that appellant had sufficient balance in the Cenvat Credit account. - the penalties imposed by the adjudicating authority under Section 76 and 78 of the Finance Act, 1994, are very harsh and unwarranted - the appellant is subsidiary of a Government of Gujarat undertaking and also noting that appellant could have had a bonafide belief that the ‘digital signature certification services’ would not fall under the category of exempted services, by invoking provisions of Section 80 of the Finance Act, 1994, we hold that appellant has made out a reasonable and justifiable cause for setting aside the penalties. - penalty waived - Decided partly in favor of assessee.
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