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2020 (3) TMI 18 - CESTAT MUMBAINon-payment of service tax - GTA service - repair and maintenance service - demand of service tax - recovery of inadmissible Cenvat Credit - demand of interest and penalty - HELD THAT:- Appellant had substantially demonstrated before the adjudicating authority about the differential amount that found reflected in ST-3 Return and financial statement but in the OIO the said explanation was dishonoured primarily on two grounds. First, appellant has accepted the audit report and discharged service tax liability immediately thereafter. Second, notification no. 30/2012-ST clearly stipulated that the service recipient in respect of transportation of goods is liable to pay 100% service tax under the reverse charge mechanism. Both the grounds are unsustainable for the reason that acceptance of an assessee or offer by an assessee to pay tax will not make the taxation rule legally tenable since it has to pay tax supposed to be imposed in conformity to Article-265 of the Constitution of India. CENVAT credit - HELD THAT:- As found from the OIO and OIA, admissibility of Cenvat Credit on other services like general insurance and maintenance, repair services were denied on the ground that Rule 2(l) clearly denies such availment but a bare reading of Rule 2(l) (BA) reveals that service of general insurance business, servicing, repair and maintenance, in so far as they relate to motor vehicle which is not used as capital goods are excluded from the definition of input service with certain exceptions. However, in the instance case, appellant had manifestly demonstrated that it had availed management, maintenance and repair services as defined in section 65(64) of the Finance Act, 1994 and not paid service tax towards maintenance and repair of vehicle, which was held to be inadmissible with the introduction of negative list. Demand of intererst and penalty - HELD THAT:- In view of decision of this Tribunal given in the case of NAGPUR NAGRIK SAHAKARI BANK LTD. VERSUS CCE & ST, NAGPUR [2018 (11) TMI 1524 - CESTAT MUMBAI], Cenvat Credit taken or utilised before amendment and utilised after amendment do not carry much difference to impose interest and penalty unless such utilisation is in respect of inadmissible credits. Therefore no penalty can be imposed on the appellant on all these three scores since the demands are unsustainable in law and facts. Appeal allowed - decided in favor of appellant.
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