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2016 (8) TMI 307 - CESTAT ALLAHABAD

2016 (8) TMI 307 - CESTAT ALLAHABAD - 2017 (47) S.T.R. 249 (Tri. - All.) - Cenvat credit common input services - credit on capital goods used exclusively for providing exempted services - Held that: - appellant is maintaining separate account as required under Rule 6(2) of the CCR, 2004 and there is no contrary finding save and except as alleged by the Id. Commissioner that in the statement of Senior Manager (finance), he did not state unambiguously. - In view of the clinching documentary evid .....

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0360-70362/2016 - Dated:- 19-11-2015 - Mr. Anil Choudhary, Judicial Member and Mr. C.J. Mathew, Technical Member Present Shri B.L. Narasimhan , Advocate for the appellants Present Shri Devendra Nagvenkar, Additional Commissioner (A.R) for the respondent/Revenue ORDER The appellant, M/s Magnum Ventures Ltd. is in appeal against the order-in-original dated 5.6.2012 by which the demand of cenvat credit has been made under Rule 6 (3) read with Rule 6(3A), some invoices on which cenvat credit availed .....

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d Shri Sunil Chauhan, Manager (Excise) on whom penalty of ₹ 5 lakhs is imposed under Rule 15(1) of Cenvat Credit Rules, 2004 read with Section 78 of the Finance Act, 1994. 3. The brief facts of the case are that the appellant, a manufacturer, obtained registration in the year 2008-09 under the categories of Business Auxiliary Service, Transport of Goods by Road (GTA), Interior Decorators, Dry Cleaning, Health Club and Fitness Centre, Internet Telephone, mandap Keeper, Outdoor Catering, Pan .....

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cause notice dated 12.7.2011 was issued and it appears that the appellant failed to provide documents/information leading to issuance of summons and in the statement of Shri V. S. Gusain (Manager-Finance) stated that they are not maintaining any separate account/inventory in respect of utilisation of input credit and input for taxable and non-taxable services. Further it appears that the appellant failed to submit the desired information in spite of reminders and on the basis of information prov .....

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ts have utilized the common input service for which credit is availed for taxable as well as exempted services provided by them. Further, it appears that the appellant has not followed the procedure as required for maintaining separate account under Rule 6(2) of Cenvat Credit Rules, 2004 and hence is liable to pay the required percentage, by way of reversal, under Rule 6(3) on the exempted service provided. In respect of some input service and inputs on which credit was availed the documents bei .....

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Credit Rules, 2004 read with proviso to Section 73(1) of the Finance Act, 1994. Further the amount of ₹ 29,88,886/- should not be demanded and recovered for inadmissible /wrong availment of cenvat credit under the provision of Rule 14 and further the amount of ₹ 81,189/- reversed by the appellant out of the amount of ₹ 29,88,886/- should not be appropriated and why interest and penalties under Rule 15(3) read with Section 78 and personal penalty on Vijender Singh Gusain, Senio .....

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vely for providing exempted services. 5. Being aggrieved, the appellants are before this Tribunal. 6. The first ground urged is that the activity of providing room accommodation, restaurant, wet cleaning were neither exempted services nor the same were taxable services and therefore, Rule 6 of Cenvat Credit Rules, 2004 is not applicable. Ld. Counsel states that on plain reading of Rule 2(e) of CCR, 2004 that "exempted service" means taxable services which are exempt from the whole of t .....

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sing of the Finance Act, 2011. In this view of the matter, there is no applicability of Rule 6 in their case. 7. Opposing the contention, the Id. A.R. for Revenue relies on the ruling of coordinate Bench of this Tribunal in the case of Idea Cellular Ltd. Vs. C.C.E., Rohtak - 2009 (18) STR 712 (Tri-Del.) wherein para 3.1 it has been pleaded by the assessee that 'inter connectivity/network access service, roaming service' and 'infrastructure use service' are not 'exempted servi .....

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ends that service is exempt only when the service is one of the services as defined in Section 65(105) of the Act. It is further contended that without admitting that the service is exempt service, by virtue of Rule 6(2), they have maintained separate records of the input services utilised towards exempted services as well as taxable service. Ld. Counsel further draws attention to para 24 of the impugned order wherein the authorities have taken notice of the contention that the appellant has mad .....

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s hotel restaurant etc. Further, the appellant have paid service tax on the output services in accordance with the scheme of the Act or Rule. The appellant has also produced Chartered Accountant's certificate in support of their contention as to non-availment of cenvat credit, for proportionate hotel space utilised for non-taxable service. Ld. Counsel further states that even otherwise also, they have taken modvat credit of common input services amounting to ₹ 3,22,80,600/-. Out of thi .....

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ible under Rule 6(3A) of the CCR, 2004. Ld. Counsel further points out that the Id. Commissioner has rejected their contention as regards to separate account maintained only on the ground of statement of Shri Vijender Singh Gusain, Senior Manager (Finance) stating they have not maintained inventory/separate account. For appreciation answer the question to the officer, the same are reproduced below: Q. Whether you have maintained separate account/inventory for utilisation of input services credit .....

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able service. Thus, there was no question of reversal. Ld. Counsel further states that the extended period is not invocable and whole demand is time barred. The appellant is maintaining proper registers of transactions and making timely compliance by filing returns. 10. So far as the second issue is concerned (Rs.21,45,284/-) as regards the document on which cenvat credit has been taken are deficient, it is urged that the document relating to imports are concerned, the same have to be read as a .....

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ice tax paid is given in the bill of the Container Corporation of India which have been paid. So far as invoices of R.K. Suri, a freight forwarder is concerned the defect pointed out is that name of the consignee is not mentioned, as it appears from the invoice in the paper book, the name of the appellant is there and as such there is no defect. Further the service tax, bill number, amount of service tax etc. were also given. As regards the services availed from MEC Electric Contracts (P) Ltd., .....

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