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2024 (4) TMI 910 - CESTAT KOLKATALevy of service tax - Works Contract Service - availment of Composition Scheme - GTA service - CENVAT Credit in terms of Rule 6(3) of CCR, 2004 - works Contract executed on or after 01.07.2012 under ‘other works contract’ - Credit denied on the ground that the documents prescribed under Rule 9(1) of the CCR were not submitted - suppression of facts or not - extended period of limitation. Works Contract Service - availment of Composition Scheme on 25.01.2008 - HELD THAT:- W.e.f. 01.06.2007, the appellant has been discharging service tax liability on the said service under the “Composition Scheme”. In the absence of any laid down procedure under the law specifying the time limit, we observe that the payment of service tax itself should be construed as exercise of the option by the Appellant when such option was continued by the Appellant till the related works contracts were completed - this issue is squarely covered by the decision of the Tribunal, Delhi in the case of MEHTA PLAST CORPORATION VERSUS COMMISSIONER OF CENTRAL EXCISE, JAIPUR [2014 (5) TMI 1131 - CESTAT NEW DELHI] wherein it was held that “the option to be exercised is not required to be exercised in writing and the very fact of payment of duty under the composition scheme reflects upon the option of the assessee - the appellant is eligible for availment of Composition Scheme for payment of service tax and hence the demand confirmed in the impugned order by denying the benefit is not sustainable - demand set aside. GTA service - HELD THAT:- The demand has been mechanically confirmed without verifying the documents submitted the appellant. The documents submitted by the appellant needs to be verified. The demand confirmed without verifying the documents is not sustainable. Accordingly, the demand confirmed in the impugned order on this count is set aside and the matter remanded to the adjudicating authority to verify the documents submitted by the appellant and determine the service tax liability, if any, after giving an opportunity to the appellant to explain their case. The appellant should also cooperate with the department and furnish all the documents for verification. CENVAT Credit in terms of Rule 6(3) of CCR, 2004 - providing construction service to Airports Authority of India in Jammu & Kashmir and to Unitech Hi-Tech Structure Limited, an SEZ unit which are exempted services - HELD THAT:- The main objective of the Rule 6(1) is to ensure that the assessee should not avail the CENVAT Credit in respect of input or input services which are used in or in relation to provision of exempted services - In the present case, since the appellant has reversed the credit attributable to exempted services along with interest, the demand of an amount equivalent to 6/8% of the value of exempted services confirmed in the impugned order is not sustainable - the demand of reversal of CENVAT credit of Rs.37,91,781/- in the impugned order is set aside. Works Contract executed on or after 01.07.2012 under ‘other works contract’ - HELD THAT:- The appellant is liable to pay service tax as ‘Original Works’ on the 40% value of such works contract as prescribed in Rule 2A(ii)A of the Valuation Rules. It is observed that the department has not brought in any evidence to substantiate the allegation that the contracts executed by the appellant were in the nature of completion and finishing service to demand service tax under ‘Other Works’ on the 60% value of such works contract as prescribed in the said Rules. Accordingly, the demand of service tax of Rs. 19,32,135/- (including Cess confirmed in the impugned order on this count is not sustainable and hence the same is set aside. Credit denied on the ground that the documents prescribed under Rule 9(1) of the CCR were not submitted - HELD THAT:- The invoices were not checked by the audit team on the pretext that the documents are voluminous and will take lot of time and they have to conclude the audit within three days. The audit has concluded that the entire cenvat credit availed and utilised by the Appellant during the period 2009 – 10 to 2012 – 13 as irregular and the same has been confirmed in the impugned order. It is observed that the demand has been mechanically confirmed without verifying the documents submitted the appellant. The documents submitted by the appellant needs to be verified. The demand confirmed without verifying the documents is not sustainable - the demand confirmed in the impugned order on this count is set aside - the matter remanded to the adjudicating authority to verify the documents submitted by the appellant and determine the eligibility of Cenvat credit after giving an opportunity to the appellant to explain their case. Suppression of facts or not - extended period of limitation - penalty - HELD THAT:- It is a settled position of law that when the matter involves interpretation of statutory provisions and the assessee acted on a bona fide belief, extended period of limitation cannot be invoked. We observe that there is no evidence available on record to invoke the extended period of limitation. Accordingly, the demand is not sustainable on the ground of limitation also. For the same reason, no penalty imposable on the appellant. Appeal disposed off.
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