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2017 (11) TMI 157 - AT - Service TaxCENVAT credit - whether the availment of CENVAT credit on common input services which are used for trading as well as rendering taxable output services is correct as also liability of interest on the full credit availed on capital goods in the first year itself? - Held that: - As regards the availment of CENVAT credit on the capital goods, 100% of the amount of Central Excise duty paid, appellant’s availment of 100% of credit of duty paid on capital goods in the first year was an error, as per law appellant is entitled to avail CENVAT credit of balance 50% in the subsequent year - demand set aside. Eligibility to avail CENVAT credit on FRO crates which are not capital goods - Held that: - FRO crates cannot be considered as capital goods, if they are not considered as capital goods, the explanation given by the appellant before the lower authorities that such crates are used by them for movement of their various components which are used for rendering output service as authorised service station can be considered as inputs. Hence availment of CENVAT credit of the Central Excise duty paid on such FRO crates cannot be disputed and the appeal to that extent contesting the findings has merits and is allowed. Availment of CENVAT credit on capital goods without proper documents - Held that: - In the case in hand, appellant is not providing any output service in order to avail the input service which has been taxed and charged by the service stations to whom appellant has outsourced the services of rendering free warranty services - credit not allowed. Appeal allowed in part.
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