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2021 (9) TMI 1099 - AT - Central ExciseCENVAT Credit - input services - Group Medical insurance Policy for its employees and their family members - scope of amended definition of ‘input service’ under Rule 2(l) of Cenvat Credit Rules, 2004 - malafide intention on the part of the Appellant, or not - suppression of facts or not - invocation of extended period of limitation - Penalty - HELD THAT:- Rule 2(l), CCR, 2004 has been amended w.e.f. 1.4.2011 and from that date ‘insurance’ has been brought under the exclusion clause and there is no ambiguity/confusion in understanding the said definition of ‘input service’ after 1.4.2011 - Since w.e.f. 1.4.2011 the service in issue clearly falls in the excluded category, therefore the Cenvat credit availed on these services is inadmissible to the Appellant whether without any additional premium or even if it is attributable to the family members only. When the language of the rule is clear and unambiguous and despite that assessee is not doing his part of obligation then the malafide is apparent and it cannot be termed as bonafide mistake. Therefore the extended period has rightly been invoked by the authorities concerned. The issue to be considered is whether the relevant information was placed before the department earlier and if so in what form, whether in a manner from which the issue at hand was clearly discernible to the department. The provision in the rule relevant to the credit taken is very clear and simple and easy to understand. The very fact that the assessee has taken proportionate credit by adopting their own interpretation without intimation to department would justify to consider this as a case of mis-representation and suppression to invoke extended period for demanding the excess credit availed. Penalty - whether penalty can be reduced to 25% when credit admittedly was reversed before the issuance of show cause notice and interest and penalty was paid within 30 days from the date of the receipt of Adjudication Order? - HELD THAT:- It is not disputed that the demand confirmed in the adjudicating order amounting to ₹ 7,69,054/- was paid by the appellants on 18.1.2013 & 22.1.2013 respectively i.e. well before the issuance of the show cause notice and the interest thereon of ₹ 1,84,043/- alongwith 25% penalty amounting to ₹ 1,92,264/- was also paid by the appellants on 14.2.2017 i.e. within 30 days’ period from the date of communication of the Order-in-Original dated 30.12.2016 (issued on 13.1.2017), which was received by the appellants only on 15.1.2017 - this relief can be granted to the appellants and accordingly the penalty is reduced to 25% which, as submitted by learned counsel, has already been deposited by the appellant. Appeal allowed in part.
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