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2014 (1) TMI 1096 - CESTAT AHMEDABADAvailment of CENVAT Credit - Excise duty paid on pipes and other materials used in Transportation of goods through pipelines or other conduit services - The department took the view that GSPL was not entitled to take CENVAT credit of duty paid on pipes etc., as the same were neither inputs nor capital goods for them because the pipes were inputs or capital goods for the EPC contractors and the pipeline system (on which no duty or service tax was paid, the same being immovable property) alone was relevant for the services rendered by GSPL. Besides, credit taken in respect of input services used by the contractors and the credit of service tax paid by the contractors was denied to GSPL on the ground that neither CENVAT duty nor service tax was payable on immovable property. Whether conditions prescribed in the Notification No. 12/2003-S.T., have not been contravened by the appellant - Held that:- Appellant is not using pipes for providing any output service but have supplied it for construction of pipeline to the EPC contractor. Being a free supply material, if the value of the same is not included in the pipeline system by the output service provider, question of availment of credit also does not arise. The definition of input service also does not help the appellants to get the credit of duty paid on pipes. The definition requires the input services to be ‘‘used for” providing an output service and it cannot be said that the inclusion clause helps them to take credit of service tax paid by the EPC contractor we are not able to find any provision which allows them to take credit of duty paid on pipes and also service tax paid on construction of pipeline system. A conscious decision was made by the appellant and the EPC contractor to avail the benefit of Notification No. 12/2003 especially in the case of appellants, they had also taken a legal opinion. Once a choice is made the consequence of the choice also inevitably follows and has to be suffered. - Decided against the aassessee. Bar of limitation - Held that:- taking a view that assessee did not furnish additional information to the department and filing returns in the proforma prescribed giving the information required to be given does not mean full disclosure, would be total injustice to the assessees. Suppression of facts would arrive only when facts which are required to be disclosed according to the provisions of statute are not disclosed or there should be deliberate withholding of information - extended period in this case was not invocable and therefore duty demand beyond the normal period can be confirmed. Whether penalty is imposable and if so provision of Section 80 can be invoked for not imposing penalty - Held that:- After an assessee takes a view that this is similar to the situation where a contractor is appointed to erect plant and machinery for a big factory and a production of plant and machinery are purchased by the principal and given to the contractor and purchased by the contractor himself, if credit can be availed by the principal, a similar facility would be available to the appellants - When there is fraud, evasion of duty by misstatement or suppression of facts, merely because a letter has been written seeking clarification does not mean extended period cannot be invoked. In the facts and circumstances of this case, we feel that appellants did entertain a bona fide belief and therefore even if it is assumed that there was a misstatement or suppression of facts, the provision of Section 80 which provided for non-imposition of penalty are applicable. Appellants are not eligible for CENVAT credit of duty paid on pipes during the normal period of limitation. Therefore appellant would be liable to payback the CENVAT credit availed of duty paid on pipes with interest within the normal period of limitation which will be worked out by the departmental authorities and intimated to them. The demand for extended period is set aside. Penalties are also set aside - Decided partly in favour of assessee.
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