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2009 (11) TMI 202 - AT - Service TaxCenvat Credit- The appellants herein are engaged in the manufacture of ‘pneumatic tyres’, availing credit of duty paid on inputs and capital goods and service tax paid on input services. During the period Mar.’05 to Jan.’06, they had paid service tax of Rs. 2,52,476 through debit in their CENVAT credit account of inputs and capital goods as they were persons liable to pay service tax on GTA services received by them for transportation of inputs and capital goods and outward transportation of their finished goods up to their depot (place of removal). The said amount of service tax paid was taken as input service tax credit. Show-cause notice was issued proposing recovery of the credit amount on the ground that payment through CENVAT debit instead of cash payment was in contravention of rule 3(4) of the CENVAT Credit Rules, 2004 and that the amount of credit had been availed without the challan evidencing payment of the tax amount. The adjudicating authority confirmed the demand together with interest and also imposed penalty. The lower appellate authority upheld the adjudication order; hence this appeal. In the light of the various decisions, held that- set aside the impugned order and allow the appeal.
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