TMI Blog2013 (11) TMI 1456X X X X Extracts X X X X X X X X Extracts X X X X ..... cribes that cenvat credit taken by the appellant can be used for payment of tax for any service - Decided in favour of assessee. - ST/757/2011 - Final Order No. A/11297/2013-WZB/AHD - Dated:- 27-9-2013 - Mr. H.K. Thakur, J. For the Appellant : Sh. Gajera (Adv.) For the Respondent: Sh. K.J. Kinariwalla (A.R.) JUDGEMENT Per : Mr. H.K. Thakur; This appeal has been filed by the appellant against OIA No. SA/128/VAPI/2011, dt. 29.08.11 passed by Commissioner (Appeals) Vapi. The issue involved is regarding demand of service tax paid by the appellant by using the accumulated cenvat credit lying with the appellant with respect to the manufacturing the activity under Notification No. 30/2004-CE 29/2004-CE both dt. 09/07/2004. It was the claim of the appellant before first Appellate Authority that they are availing benefit of both the Notifications No. 30/2004-CE dated 09.07.2004 and 29/2004-CE dated 09.07.2004 and that they have rightly utilised accumulated cenvat credit lying with the appellant while discharging service tax liability under business auxiliary services. The first Appellate Authority rejected the claim of the appellant on the grounds that appellants wer ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 4. Heard both sides and perused the case records. 5. The issue involved in the present appeal is whether the appellant is doing both the activities of manufacturing dutiable goods and providing dutiable services. It is the case of the revenue that w.e.f. 01.07.2007 appellant was only clearing the goods under exemption, therefore, the credit laying in utilised on 01.07.2007 cannot be utilised by discharging the service tax liability with respect to business auxiliary services provided by the appellant. In this regard, it is relevant to glance through para-5, to 8 of the letter written by the appellant to the Superintendent, Central Excise Range-IV,Silvassa received on 02.07.2007:- 5- We submit the w.e.f. 01/07/2007 we have decided to switch over from dutiable scheme of Notification No. 29/2004-CE dt. 09/07/2004 to Fully Exemption Scheme of Not. No. 30/2004-CE dt. 09/07/2004, in respect of Polyester Texturised Yarn C.S.H. No. 54023300 manufactured by us. 6- We submit that we have reverse duty against Qty (Input) which is lying in our factory premises in the form of Input/WIP/Finish Goods (POY-1161157.438/Paper Tube 14595/Yarn Oil -57295.968). We have already reve ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... appellants were clearing goods on payment of duty. Once both the activities of Central Excise clearance of manufactured goods on payment of duty and service tax payment on business auxiliary services are undertaken simultaneously, then the credit lying in the admissible cenvat credit account can be used for debiting either payment of Central Excise duty or for discharging service tax liability. There is no bar under the Cenvat Credit Rules, 2004 that cenvat credit earned on capital goods/inputs used in the manufacture of dutiable furnished goods cannot be used for discharging service tax liability on services provided by the same appellant. Appellant has correctly relied upon the judgment of CESTAT, Mumbai Bench in the case of S.S. Engineers Vs. CCE Order No. A/762/13/EB/C-II, dated 19.08.13 that payment of excise duty or service tax is permissible from the cenvat credit and the appeal filed by the appellant in that case was allowed. Para 5, 6 7 of this judgment reads as follows:- 5- We have considered the rival submissions. We have gone through the Cenvat Credit Rules. We find that Rule 2 defines input, input services, capital goods etc. Before availing Cenvat cr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n other words, a manufacturer of excisable goods is entitled to use the credit from a common pool to which different categories of specified excise duties, customs duty and service tax are allowed to be taken as credit. Similarly, a provider of taxable service is also entitled to take credit of specified excise duty, additional duty of customs and service tax in respect of input services and utilize the credit from all these sources for the purpose of paying service tax. The objection by the Department is that the respondent who is both a service provider and a manufacturer should maintain two separate accounts one in respect of credit attributable to inputs, capital goods and services meant for excisable goods and credit attributable to capital goods, inputs and services attributable to the service provided by them. Common CENVAT Credit Rules have been framed in terms of powers conferred by Section 37 of the Central Excise Act, 1944 and Section 94 of the Finance Act, 1994. Rule 3(1) enables a manufacturer or a provider of taxable service to take credit of specified duties and utilize them to discharge duty liability under Rule 3(4) of the CENVAT Credit Rules. A credit can be u ..... X X X X Extracts X X X X X X X X Extracts X X X X
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