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2019 (7) TMI 1695 - CESTAT ALLAHABADCENVAT Credit - input/input services - credit availed by them was being utilised for payment of duty of excise as also for payment of Service Tax on the output services - period April, 2011 to March, 2015 - HELD THAT:- The appellant was acting in dual capacity of manufacturer as also output service provider. The input credit availed on various inputs and input services, which are relatable to the manufacturing activities only, can be utilised only for payment of duty in respect of the manufactured goods. The same cannot be utilised for payment of Service Tax. In terms of the provisions of Rule 3 of Cenvat Credit Rules, 2004, the manufacturer or producer of final product or provider of output services is entitled to take the credit of duty paid on various inputs as also input services. Further in terms of sub-rule (4) of Rule 3 manner of utilization of Cenvat credit is prescribed. In terms of sub-rule (4), the credit availed by an assessee can be utilised for payment of duty of excise on any final product or payment of Service Tax on any output service. There is no distinction in the said sub-rule that the credit relatable to the input service used for manufacture shall be used only for payment of duty on the manufactured goods and the credit availed in respect of input services used for providing output services would be used only for payment of Service Tax. In the absence of any such distinction made in the Cenvat Credit Rules, 2004, the reasoning of the authorities below cannot be upheld. Extended period of limitation - HELD THAT:- Admittedly the appellant was filing all the requisite returns with the Revenue indicating the credit earned by them and so utilised. The Revenue has not referred to any evidence on record to show that there was any mala fide on the part of the assessee, except the fact that such availment and utilization was to be reflected in ER-1 return and the same should have been reflected separately in ST-3 returns - Otherwise there is no dispute about the fact of availment of credit and its utilization having been reflected in the returns. In such a scenario, there are no reasons to invoke the extended period of limitation. The appeal is allowed on merits as also on limitation.
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