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2018 (12) TMI 371 - AT - Central ExciseCENVAT Credit - recovery of proportionate credit in relation to amount adjusted from the invoices as liquidated damages - Circular No. 122/3/2010-ST dated 30.04.2010 - Rule 3 of CCR - Held that:- The provider of taxable service is allowed to take the credit of the amount paid on input services received, i.e. the gross amount charged as consideration for the purpose of services and such credit shall be allowed on or after the day which the payment is made of the value of input services. This value has to be computed in accordance of the various sub-rules of Section 67 vide which valuation is the cost incurred by the service provider and charged. Circular No. 122 of 34/2010 - Held that:- Circular is about clarification regarding availment of credit on input services. More specifically about a doubt raised as to whether the receiver of input service can take credit only after the full value i.e. indicated in the invoice / bill/ challan rest by the service provider and also the service tax payable thereon has been paid and as to whether when the service receiver does not pay the full invoice value and the service tax indicated thereon due to some reasons - The order under challenge is silent about Circular despite it was duly brought to the notice of the adjudicating authority below and despite the fact that it covers the issue involved herein. The authority below has opted to rely upon Circular No. 877 dated 17.11.2008. The perusal thereof shows that it is about clarification regarding reversal of cenvat credit in case of trade discount. This perusal itself is sufficient to hold that the Circular is not applicable to the facts in hand. The Commissioner(Appeals) has wrongly placed reliance on the said Circular. Irrespective that this Circular is about the excise duty but the intention of the Revenue herein is also same as in Circular No. 122 i.e. irrespective the price is reduced subsequent to raising the invoice the credit can still be availed on the duty paid in accordance of the amount shown in the invoice. This finding is opined to be sufficient to hold that the findings of Commissioner(Appeals) are erroneous on the face of it. When the service tax paid by the provider has not varied, cenvat credit cannot be reduced, no question of denying availment at all arises. Appeal allowed - decided in favor of appellant.
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