TMI Blog2017 (9) TMI 421X X X X Extracts X X X X X X X X Extracts X X X X ..... e of rendition of taxable service and not the rate in force on the date of receipt of payments for such services - the demand of service tax of ₹ 2,06,000/- against the appellant M/s R.G. Pigments Pvt. Ltd. is sustained - the facts do not indicate any wilful, misstatement or suppression of facts, fraud or collusion with intent to evade payment of service tax on the part of the appellant, the equivalent penalty of ₹ 2,06,000/- imposed on the appellant M/s R.G. Pigments Pvt. Ltd. under Section 78 of the Finance Act, 1994 is hereby dropped. Appeal allowed - decided partly in favor of appellant. - ST/50085/2014-DB & ST/50521/2014 - ST/A/55591-55592/2017-CU[DB] - Dated:- 31-7-2017 - Mr. Dr. D.M. Misra, Member (Judicial) And Mr. Ashok K. Arya, Member (Technical) Shri Vijay Kumar, Advocate - for the appellant Shri Amresh Jain, D.R. - for the respondent ORDER Per: Ashok K. Arya M/s Mittal Pigments Pvt. Ltd. and M/s R.G. Pigments are in appeal respectively against Order-in-Appeal No.172/2013 dated 24.10.2013 and Order-in-Appeal No.119-120/2013 dated 30.8.2013, whereunder inter alia Cenvat credit of ₹ 28,32,009/- along with equivalent p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pecified in various sub-clauses therein. The specified duties among various duties include duty of excise specified in the First Schedule to the Excise Tariff leviable under the Excise Act as also Service Tax leviable under different Sections of the Finance Act, 1994. Sub-rule (4) of Rule 3 provides that Cenvat credit may be utilized for payment of various liabilities and includes any duty of excise on any final product as also Service Tax on any output service (other situations also covered under the said sub-rule, which are not relevant in the present case). Thus, we find that Rule 3 of the Cenvat Credit Rules, 2004 does not stipulate maintaining separate account as a manufacturer and as a service provider. Third proviso to sub-rule (4) of Rule 3, provides that no credit of the additional duty leviable under sub-section (5) of Section 3 of the Customs Tariff Act, shall be utilized for payment of Service Tax on any output service. Similar restrictions are in other proviso. We also note that there are certain restrictions on the utilization of particular type of duties which are elaborated in sub-rule (b) of Rule 7 of the Cenvat Credit Rules. These restrictions do not cover cross u ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... vice provider has been used both for paying Excise Duty and for paying Service Tax. The rules permit taking of credit under a common pool and permit use of the credit from the common pool for different purposes and there is no restriction placed to the effect that credit accounts should be maintained for use for manufacture of excisable goods and for use for providing services. Therefore, the view taken by the Commissioner (Appeals) cannot be faulted. The clarification sought to be relied upon by the Department that input credit service taken only if the output is a service liable to Service Tax has no relevance to the present case. Undisputedly, the respondents have registered themselves as service provider of service of renting of immovable property and paying Service Tax as provider of output service and therefore the utilization of credit taken by them is valid. 7. In addition to above, we have also gone through the format of ER-1 return and ST-3 return. Sr. No. 8 and the Table details the Cenvat credit taken and utilized. In ER-1 return, in Table at Sr. No. 8, in column (9), details about Service Tax are specifically listed. On careful analysis of the said format, the int ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... writ petition had admittedly occurred prior to 1-3-2008. At that point of time the rate of service tax applicable in respect of the services in question was 2% and not 4%, which came into effect only on or after 1-3-2008. In both the writ petitions the date of receipt of payments was subsequent to 1-3-2008 but that would not make any difference because it is not receipt of payment which is the taxable event but the rendition of service. In WP (C) 5636/2010 the relevant period is March, 2008 and in WP (C) 3632/2012 the relevant period is April, May and July, 2008. 9. It should also be mentioned that at that point of time neither was Rule 5B of the Service Tax Rules, 1994 in effect nor was Section 67A of the Finance Act, 1994 inasmuch as the latter provision was inserted in 2012 which came in effect from 28-2-2012. Furthermore, even Rule 4(a)(i) of the Point of Taxation Rules, 2011 was not applicable to the facts of the present case inasmuch as those rules also came into effect much later in 2011. Recently, we had to consider a similar issue in Commissioner of Service Tax v. Consulting Engineering Services (I) Pvt. Ltd. in ST. Appl.76/2012, decided on 141-2013 [2013 (30) ..... X X X X Extracts X X X X X X X X Extracts X X X X
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