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TMI Blog2011 (7) TMI 457X X X X Extracts X X X X X X X X Extracts X X X X ..... gether. 3. Briefly stated common facts of the case are that the appellant is engaged in the manufacture of cotton yarn, blended yarn and man made fabrics falling under Chapters 52 and 55 of the Central Excise Tariff Act, 1985. The appellant is also registered under GTA Service. The appellant avails Cenvat Credit on inputs, capital goods and input services. On verification of records of the appellants it was found that the appellant paid service tax on outward transportation of finished goods through Cenvat Credit. Proceedings were initiated against them on the ground that duty is required to be paid through PLA or cash on the outward transportation for GTA and not by Cenvat Credit. The lower adjudicating authority confirmed the demand of R ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ribunal's decision in the case of ITC Ltd. v. CCE [2011] 31 STT 463/11 taxmann.com 166 (Bang. - CESTAT) wherein it was held that "irrespective of period prior to 19-4-2006 or period after 19-4-2006, the taxable service received by them, on which they were liable to pay service tax as service recipient under the provisions of section 68(2) of the Finance Act, 1994 read with Rule 2(1)(d) of the Service Tax Rules, 1994, could be treated as their 'output service' and service tax on the same was required to be paid in cash, not by utilizing Cenvat Credit. With regard to Hon'ble Punjab & Haryana High Court decision in the case of Nahar Industrial Enterprises Ltd. (supra) the learned JDR submits that the period involved in the case in hand is beyo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as discussed above, while during the period with effect from 19-4-2006 such taxable service received by them cannot be treated as their "output service", during the period prior to 19-4-2006 while the taxable service received by them, on which they were liable to pay service tax, was deemed to be their "output service" by virtue of Explanation to Rule 2(p), they were still required to pay service tax on such deemed output service" through cash, not through Cenvat Credit as discussed in para 8.1 above, without providing any taxable output service or manufacture of dutiable final products by them or other taxable services received by them. The duty paid goods received or other taxable service received by such person cannot be deemed to be in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed, the Tribunal in the case of Alstom Ltd. v. CCE 2008 (12) STR 23 has also dealt with the issue for this period and has held in that case that the credit cannot be utilized for paying service tax for this period as well. As such, as far as the period beyond 18-4-2006 is concerned, I hold that the appellant/respondent-assessees are not entitled to utilize Cenvat Credit for payment of service tax on GTA service and therefore, the duty demand and demand of interest are justified. However, considering the disputed nature of the issue, I hold that imposition of penalty in respect of the period from 19-4-2006 to 28-2-2008 is not justified and wherever penalties have been imposed, the same are set aside." 6.3 From the above it follows that for ..... X X X X Extracts X X X X X X X X Extracts X X X X
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