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2023 (12) TMI 1108 - AT - Service TaxCENVAT Credit - input tax credit availed on common input services such as advertisement, banking and finance, courier service, manpower service, renting of immovable property service, security service, telecommunication service etc. for trading also - non-maintenance of separate accounts as contemplated under Rule 6 (2) - HELD THAT:- There is nothing to show that the department has verified as to whether the trading units have availed credit on input services. It is merely stated that the trading units have provided installation services for which they have collected service tax and paid to the Government and so is engaged in services also - such installation services are output services of the trading unit and not input services. Credit cannot be availed on the service tax paid on output services viz; installation charges. On perusal of records, in the invoices issued for sale of products, the trading unit while collecting service tax on installation charges has mentioned the service tax registration number of the service unit of the appellant. This might have created confusion to the department to assume that the trading unit has availed credit on input services. Merely because the appellant trading unit had mentioned the service tax registration number of the service unit while issuing invoices, the department has assumed that the appellant trading unit must be availing credit on input services also. The department has made a conclusion that the trading units are also to be considered as service units and the demand has been raised alleging that the appellant has availed credit in regard to activity of trading. It also requires to be mentioned that while quantifying the duty demand the turnover of the trading units has been applied against the total credit availed by the service units. Thus, the appellant has been required to pay 6% of the value calculated by such formula. The department has failed to establish the allegation in the SCN that credit on common input services have been availed in regard to trading - the demand raised being factually and technically incorrect cannot be sustained. The impugned order is set aside, the appeal is allowed.
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