Home Case Index All Cases Service Tax Service Tax + AT Service Tax - 2022 (8) TMI AT This
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2022 (8) TMI 1155 - AT - Service TaxRefund claim - certain credits which have been taken for computation of the refund in terms of Rule 5 of the Cenvat Credit Rules are ineligible credits - quantification of credit by formula as prescribed by Notification No.05/2006 - HELD THAT:- Admittedly no proceedings have been initiated against the appellant for denial of such credit in terms of Rule 14 of the Cenvat Credit Rules. In absence of such proceedings, the lower authorities cannot be justified in modifying the refund claims for this reason. On perusal of the Form A at Sl No 3, it is quite evident that for computation of the “Net CENVAT Credit” is done on the basis of total cenvat credit taken on inputs and input services. From the total CENVAT Credit taken deductions is made of the amounts reversed under Rule 5C of the CENVAT Credit Rules, 2004. The formula is very clear on this aspect that no deduction from the total cenvat credit taken will be made on any other account while computing the Net CENVAT Credit. The formula under Rule 5 determines the maximum eligible refund to the assessee (10, 11 of the Form A). Whatever taxes are paid utilizing the cenvat credit availed during the period will automatically get deducted because if an assessee has utilized certain portion of the credit, then that amount would not be available as a balance on the close of the month/quarter in which the refund is sought. This Balance of CENVAT Credit is stated at Sl No 12 in the Form A. It is also clear that that while filing the refund claim claimant has to debit the amount claimed by him as refund under Rule 5 from his CENVAT Account. Above prescriptions clearly show that the lower authorities have been in error while deducting the amount of the credit that would have been utilized for payment of the taxes/duties in respect of the domestic clearances from the total CENVAT Credit taken while determining the Net CENVAT Credit for application of formula as per Rule 5. Appeal allowed - decided in favor of appellant.
|