TMI Blog2014 (6) TMI 625X X X X Extracts X X X X X X X X Extracts X X X X ..... fore, we find that the demand towards such adjustment of credit in the impugned order is not sustainable in law. The only fact that needs to be verified is whether the amount adjusted is the amount of excess tax paid or not. This needs to be verified by the department from the records and the evidence adduced by the appellant in this regard. If, on such verification, it is found that the appellant is not liable to pay any Service Tax, the question of imposition of any penalty also would not arise. As regards the demand towards excess Cenvat credit availed on the input service during the impugned period, this position has been clarified by the C.B.E. & C. in Circular No. 137/12/2008-CX.4, dated 21-11-2008, wherein the Board has clarified ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... appellant sought clarification from the department as to the taxability of the activity undertaken by them vide letter dated 31-10-2006. The department vide letter dated 10/11-1-2007 clarified that in terms of Circular No. 80/10/2004-S.T., dated 17-9-2004 Service Tax is not payable on rentals/lease charges charged by the Airport Operator. In pursuant to this clarification, the appellant adjusted the Service Tax paid by them under protest amounting to Rs. 4,17,73,025/- in the month of January, February and March, 2007. The appellant also availed Cenvat credit in respect of input services in excess to 20% of the Service Tax payable on the output services as prescribed under Rule 6(3)(c) of the Cenvat Credit Rules, 2004. Thus, an excess credit ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed 17-7-2012 held that prior to 1-6-2007, renting of immovable property within the Airport area did not attract Service Tax liability. In the meanwhile, the appellant also approached the department to clarify the matter and the department vide letter dated 10/11-1-2007 clarified that the activity does come under Service Tax. Accordingly, they adjusted the Service Tax paid from their pocket (wherever the customers did not pay the Service Tax) against the Service Tax liability on the output services in the January-March, 2007. As per Rule 6(3) of the Service Tax Rules, 1994 where an assessee has issued an invoice, or received any payment, against a service to be provided which is not so provided by him either wholly or partially for any reas ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... taken Cenvat credit on input services in excess to the 20% cap of the Service Tax payable on the output services provided in Rule 6(3)(c) of the Cenvat Credit Rules, 2004. This cap was removed from 1-4-2008. Rule 6(3)(c) of the Cenvat Credit Rules, 2004 only prohibited utilization of Cenvat credit and not taking of the credit per se. Therefore, when the cap was removed, they were eligible to avail all the accumulated Cenvat credit from 1-4-2008 onwards. Therefore, they are not liable to pay back the entire credit taken. It is also his contention that during the impugned period, there were both excess and short payments and if adjustments are made, the net payment would be excess. Hence, they are not liable to pay any interest also. 3.1 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Service Tax on renting/leasing the premises in the Airport. The appellant adjusted the excess Service Tax paid by them against the tax liability during January - March, 2007. The action taken by them was strictly in accordance with the provisions of said Rule and, therefore, we find that the demand towards such adjustment of credit in the impugned order is not sustainable in law. The only fact that needs to be verified is whether the amount adjusted is the amount of excess tax paid or not. This needs to be verified by the department from the records and the evidence adduced by the appellant in this regard. If, on such verification, it is found that the appellant is not liable to pay any Service Tax, the question of imposition of any penalty ..... X X X X Extracts X X X X X X X X Extracts X X X X
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