Home Case Index All Cases Service Tax Service Tax + AT Service Tax - 2023 (6) TMI AT This
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2023 (6) TMI 146 - AT - Service TaxReversal of CENVAT Credit - common input services for providing both taxable and non-taxable service - Rule 6(3A) of the Cenvat Credit Rules, as amended by Notification No. 13/2016-CE (NT) dated 01.03.2016 - time limitation - suppression of facts - penalty - HELD THAT:- From perusal of the rule, it is evident that the rule is applicable only in respect of the common credit taken for provision of both taxable and exempted services. The approach adopted by the Commissioner by taking total credit for three years i.e. April 2015 to 30.06.2017 for the reversal cannot be justified accordingly. Even otherwise, the appellant was providing upto 15.01.2016 taxable services only on which they were paying the required service tax. Accordingly taking the value of the total Cenvat credit for the period April 2015 to 30.06.2017 cannot be justified. The appellant was required to reverse under Rule 6(3A) credit of Rs.1,96,730/- which they paid along with interest on 04.01.2020. It is now settled law that procedural violation while making the above reversal should not come in way allowing the benefit under Rule 6(3A). Commissioner also does not do so. Commissioner has imposed penalty in terms of Rule 15(2) of the Cenvat Credit Rules, 2004 read with the provisions of Section 11AC of the Central Excise Act, 1944. Commissioner has in the impugned order concluded that appellant has willfully suppressed the facts from the revenue to avoid the reversal of the common credit taken by them for providing the taxable and exempted services, as required in terms of Rule 6 of the CENVAT Credit Rules, 2004. This finding of fact has not been seriously challenged/ disputed by the appellant. However, taking note of the fact that actual amount of credit that was required to be reversed and not reversed is only Rs.1,96,730/-, the penalty imposed upon the appellant under Section 78 of the Finance Act reduced to Rs.1,96,730/-. The option given by the Commissioner for payment of 25% of the penalty in case the amount determined is paid along with interest and reduced penalty within 30 days of communication of this order will be available to the appellant. Appeal allowed in part.
|