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2018 (11) TMI 831 - AT - Service TaxCENVAT Credit - common input services for trading goods - case of appellant is that the trading of goods has come into the exempted category only since 31.03.2011 and therefore the explanation adding ‘trading’ in the exempted service category cannot be made retrospectively applicable - also appellant has reversed back the amount of common input service credit availed by them. Held that:- For the period upto 01.04.2011, 100% CENVAT credit is available for certain services as per Rule 6(5) of the CENVAT Credit Rules, 2004. Trading was not included in ‘Exempted Service’ upto 31-03-2011 and prior to that the same was not considered as exempted services for the purpose of Rule 6(3) of the CENVAT Credit Rules, 2004. Therefore, there was no need to demarcate between taxable as well as exempted services for the purpose of availment of CENVAT Credit. The Appellant have already reversed ₹ 4,93,236/- as portion of Common CENVAT Credit attributable to both taxable as well as for trading activity in view of provision of Rule 6 of the CENVAT Credit Rules, 2004. The credit of the service tax paid on the services as enumerated under Rule 6(5) of the Cenvat Credit Rules, 2004 are to be allowed - Rule 6(5) starts of non-obstante clause ‘notwithstanding’, which would indicate that the provisions of Rule 6(3) are not applicable for the provisions of Rule 6(5) of Cenvat Credit Rules, 2004. Extended period of limitation - penalty - Held that:- The credit amount which has been reversed by the appellants has neither been accepted or examined by the department and the amount has been upheld without any verification. The demand for the extended period of limitation is set aside - penalty also set aside - for the limited purpose of verification and re-quantification of demand for the normal period, the matter is remanded to the Adjudicating Authority. Appeal allowed in part by way of remand.
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