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2016 (6) TMI 1001 - CESTAT CHENNAI

2016 (6) TMI 1001 - CESTAT CHENNAI - 2016 (45) S.T.R. 551 (Tri. - Chennai) - Cenvat credit on the CHA service and outward freight paid on export clearances - manufacture of water pumps - adjudicating authority denied the input service credit on the impugned services, on the ground that benefit of Notification No. 17/2009 should have been compulsorily availed by the exporter manufacturer. - Held that:- Since the notification being a conditional exemption notification, it is for the manufactur .....

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R M/s. Save Industry, the appellant herein are engaged in the manufacturer of water pumps and sell their final products in the domestic as well as in the foreign market and availed Cenvat credit on the inputs and input services in accordance with the provisions under Cenvat Credit Rules, 2004. The issue in dispute relates to availment of Cenvat credit on the CHA service and outward freight paid on export clearances during the period 2005-06 to 2010-11. A show cause notice dated 26.05.2011 was is .....

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, 2004, but exemption can be claimed as refund of service tax. It further alleges that the appellants did not bring it to the notice of the department that the credits have been taken on these services and hence proposed to invoke extended period of limitation. On adjudication, the adjudicating authority disallowed the Cenvat credit of service tax availed to the tune of ₹ 99,819/- along with interest and imposed equal penalty under Rule 15(4) of CCR read with Section 78 of the Finance Act, .....

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t the adjudicating authority has not considered the case laws relied upon before him in support of their contention and also their specific defences of revenue neutrality and bonafide belief was not taken into consideration. He argued that as per Rule 2 (l) of CCR, 2004, the disputed services are input services and are eligible for availing Cenvat credit. He submitted that their contention with regard to availment of exemption as per the Notification relied on by the department and the relevant .....

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ri.-Mum.) 3. Plus Paper Foodpac Ltd. Vs. CCE, Thane 2013 (30) STR 529 (Tri.-Mum.) 4. JSW Steel Ltd. Vs. CCE, Thane-I 2014 (36) STR 801 (Tri.-Mum.) 3. On the other hand, the Ld. AR, Shri K.P. Muralidharan, AC, appearing on behalf of the Revenue submitted that both the authorities below have correctly disallowed the Cenvat credit availed by the appellant and demanded the same along with interest and equal penalty for wrong availment of cenvat credit and contravention of the provisions of CEA, 1944 .....

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ods have been exported. Rule 2 (l) of Cenvat Credit Rules, 2004, stipulates that (l) input service means any service, - (ii) used by a manufacturer, whether directly or indirectly, in or in relation to the manufacture of final products and clearance of final products upto the place of removal, and includes services used in relation to modernisation, renovation or repairs of a factory, premises of provider of output service or an office relating to such factory or premises, advertisement or sales .....

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ut service credit. Hence, I hold that the CHA service has been availed by the appellant till the place of removal. Decisions of the Mumbai Bench of the Tribunal in the cases of Premier Conveyors Pvt. Ltd. (supra, Plus Paper Foodpac Ltd.,(supra) and JSW Steel Ltd. (supra), relied on by the appellant are in favour of the appellant, wherein it has been held that being a manufacturer of excisable goods if the assesse availed any services, the assesse is entitled to take input service credit in the c .....

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