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2022 (10) TMI 321 - CESTAT NEW DELHICENVAT Credit - common input services used both in providing the taxable service and the exempted service - security services telephone services - non-maintenance of separate records - Rule 6(3) of the CCR - HELD THAT:- Rule 6 of CCR places several obligations upon the assessee to avail Cenvat credit. If these obligations are not fulfilled, the assessee cannot avail Cenvat credit and if an assessee avails Cenvat credit without fulfilling the obligations under Rule 6 such irregularly availed Cenvat credit can be recovered under Rule 14 of CCR. These obligations under Rule 6 can be fulfilled opting for Rule 6(1) or Rule 6(2) or Rule 6(3) of the CCR - Rule 6(3) states that if Rule 6(1) or 6(2) are not fulfilled then an amount of 5% / 6% of the value of the exempted services shall be paid. These options are available to the assessee and it is open to the assessee to chose any of the options. It is not open to the Revenue to chose one of the options and force it upon the assessee. If the obligation is not fulfilled under any of the options, the irregularly availed Cenvat credit can be recovered under Rule 14 of CCR. In this case, the appellant availed Cenvat credit and on being pointed out by the audit, reversed the entire amount of Cenvat credit so availed along with interest. The appellant could have availed Cenvat credit proportionately to the extent such common input services were used in rendering taxable services. However, to buy peace, the appellant reversed the entire amount of Cenvat credit. Therefore, no Cenvat credit on common input services remains availed by the appellant and its Therefore, the obligation under Rule 6(1) has been fully met. Further, Rule 6(2) requires separate accounts to be maintained but it does not specify in what form the accounts have to be maintained - As the appellant has fulfilled its obligation in terms of Rule 6(1) and also in terms of Rule 6(2), no case existed at all for issuance of the show cause notice in the first place nor it being confirmed by the impugned order - The show cause notice was issued and the impugned order was passed completely contrary to the law laid down by the Supreme Court in CHANDRAPUR MAGNET WIRES (P) LTD. VERSUS COLLECTOR OF C. EXCISE, NAGPUR [1995 (12) TMI 72 - SUPREME COURT]. The impugned order cannot be sustained and needs to be set aside - Appeal allowed - decided in favor of appellant.
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