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2019 (5) TMI 1014 - CESTAT MUMBAICENVAT Credit - trading (high sea sales) as well as manufacturing of goods - trading as an exempt services - Rule 6(3) of CENVAT Credit Rules 2004 - Invocation of extended period and penalty - suppression of facts or not - HELD THAT:- A pure sale, unassociated with delivery of goods and services together, is not to be considered as service - sale of goods-be it made in the high sea or within the territorial boundary of India in which Finance Act, 1994 has its force, cannot be called a service to impose tax liability or deny the credit under Rule 6 of Cenvat Credit Rules. Trading is not at all a service, as it is a sale of goods for which vat is applicable and as because it is not a service, it is put in the exempted category as an example that trading is not a service for which exemption is also applicable. Likewise audit report cannot be the sole consideration for invocation of extended period to demand duty and impose of penalty under Section 11AC of the Central Excise Act. Moreover, application of formula for computation and arrival at a figure varies on the basis of understanding of the formula and its proper application that cannot be considered as wilful violation of the provision of the Act or Rule only on the ground that re-computation of the previous period on one occasion was accepted by the respondent and duty demand was met, since rule of acquiescence pre-supposes repeated acceptance of the same thing. It cannot be said that only because audit party had found some credit availed as inadmissible, suppression of fact is made out. Appeal dismissed - decided against Revenue.
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