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2018 (5) TMI 376 - AT - Service TaxCENVAT credit - trading activity - allegation in the SCN is that the appellants had wrongly used input service credit on services which were used both in respect of taxable services of authorized service station and for trading activities - Held that: - Admittedly, the trading has been categorized as an exempted service only w.e.f. 01.04.2011. The trading activity not being a service at all, the appellants was not required to maintain separate account as the provisions of sub-rule 3 of the Rule 6 of the CCR, which could not be applied prior to 01.04.2011 - Also, credit could not be allowed against trading activities since it was neither a service falling under Finance Act, 1994, nor “manufacture” under the Central Excise Act, 1944. Therefore, the portion of input service credit availed for trading activity is not admissible - the credit would not be admissible as is attributable to the trading activity. Time limitation - penalty - Held that: - the appellants have admittedly argued that the issue was clearly of interpretation, which was finally settled by way of insertion of explanation under N/N. 3/2011-CE (NT) dt. 01.03.2011 - extended period and penalty not invocable. Appeal allowed in part.
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