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2024 (2) TMI 816 - CESTAT CHENNAIDisallowance of credit availed by the appellant on security services - security services provided for the factory premises as well as trading premises is covered under Rule 6(5) of the CENVAT Credit Rules, 2004 or not - non-maintenance of separate books of account for the common input services - HELD THAT:- The First Appellate Authority (FAA) has analysed the scope of Rule (3) of CENVAT Credit Rules vis-à-vis, the activities carried on by the appellant. The First Appellate Authority (FAA) has observed that with regard to the credit of goods, the appellant was neither a manufacturer/producer nor a provider of taxable output service, since at the material time trading was neither taxable nor exempted. Moreover, according to the First Appellate Authority (FAA) exempted goods would refer only to the goods manufactured by the appellant, on which no duty was payable, but here the appellant had only bought and sold goods instead of those which were manufactured by it. In view of the above discussions, the First Appellate Authority (FAA) has concluded that the appellant was not entitled to credit attributable to credit of goods by virtue of Rule 3 which restricts and allow credit only to the manufacturer of goods or to the provider of output services. It is not the case of the revenue that ‘security service’ was used exclusively in the manufacturing unit or used exclusively in the trading unit of the appellant, but the appellant has all along claimed that the said service was used as a common service in both the units. The amendment to Rule 2(e) was not applicable since the period under dispute is from June 2007 to January 2009 and hence, it is difficult to construe trading activity as an exempted service and that the service in question cannot be held to have been used in the provision of exempted service alone. The impugned order of the First Appellate Authority is unsustainable in law - appeal allowed.
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