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2017 (9) TMI 421 - AT - Service TaxCENVAT credit - input/capital goods - Whether the Cenvat credit taken for the input/capital goods used for manufacturing excisable goods could be utilised for payment of service tax on the output services? - Held that: - this matter is covered by the Tribunal’s decision in the case of S.S. Engineers Vs. CCE, Pune-I [2013 (10) TMI 611 - CESTAT MUMBAI] which has held that cross utilisation of credit of Excise and service tax is permissible, as a general proposition - Cenvat credit taken for the input/capital goods used in the manufacture is allowed for payment of service tax on the output services - demand set aside. What is the rate applicable for levying service tax: - whether it should be the rate as applicable on the day, when the services were provided or it should be the rate applicable for the day when the debit notes were issued by the service recipient? - Held that: - the Tribunal in the case of CST Vs. Lea Associates South Asia P. Ltd. [2014 (8) TMI 456 - CESTAT NEW DELHI] has held that service tax is to be charged at the rate prevailing at the time of rendition of taxable service and not the rate in force on the date of receipt of payments for such services - the demand of service tax of ₹ 2,06,000/- against the appellant M/s R.G. Pigments Pvt. Ltd. is sustained - the facts do not indicate any wilful, misstatement or suppression of facts, fraud or collusion with intent to evade payment of service tax on the part of the appellant, the equivalent penalty of ₹ 2,06,000/- imposed on the appellant M/s R.G. Pigments Pvt. Ltd. under Section 78 of the Finance Act, 1994 is hereby dropped. Appeal allowed - decided partly in favor of appellant.
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