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2019 (8) TMI 129 - AT - Service TaxCENVAT credit - common inputs and input services used in trading of goods and provision of taxable service - Rule 6(3) of the Cenvat credit Rules, 2004 - whether appellant is required to pay 6% of total sale value of the goods traded by them in terms of Rule 6(3)(i) when the appellant paid the actual credit attributed to the quantum trading sale in terms of Rule 6(3A) along with interest following the option available under Rule 6(3)(ii)? HELD THAT:- In the present case, it is an admitted fact that the appellant did not maintain separate accounts for the input services used in or in relation to the provision of taxable service as well as exempt service i.e. trading of goods. Therefore, two options were available to them, i.e., either to pay 6% of value of the exempted service or pay an amount equal to the credit attributable to the input services used in or in relation to exempt services subject to the provisions of Sub-rule (3A). When the mistake was pointed out, the appellant reversed the proportionate common credit taken on input services used in the provision of exempt services (trading of goods) along with interest thereon - Therefore, Rule 6(3) (i) will not have any application, when a credit is taken wrongly and the same is reversed along with interest as it tantamounts to not taking of the credit at all. The demand confirmed by the lower appellate authority has no legs and therefore the same cannot be sustained - appeal allowed - decided in favor of appellant.
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