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TMI Blog2018 (8) TMI 559X X X X Extracts X X X X X X X X Extracts X X X X ..... by them. The appellant had also taken on lease some residential premises, which had been given by them to various persons on rent. Renting of immovable property for residential purpose was not a taxable service, during the period of dispute i.e. from 2008-2009 and 2009-2010. However, the renting of immovable property for residential purposes was covered by the definition of „exempted service‟ covered under Rule 2(e) of the Cenvat Credit Rules, 2004. Since the appellant had availed Cenvat credit in respect of the common input services, which had been used in or in relation to providing of "taxable service" as well as exempted service and since they were not maintaining separate account in this regard, the department by invoking R ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e 6(3) of the Cenvat Credit Rules, 2004, during the period of dispute, the option of paying 8%/6% of the value of the exempted services under Rule 6(3)(i) cannot be forced upon the appellant; that in this regard, he relies upon the judgment of the Hon‟ble Karnataka High Court in the case of CCE, Mangalore vs. Kudremukh Iron & Steel Co. Ltd. - 2011 (271) E.L.T. 172 (Kar.), wherein the Hon'ble High Court has held that when common inputs were used in or in relation to the manufacture of dutiable and exempted final products and the credit attributable to the exempted final products was reversed, the assessee is not required to pay an amount equal to 8% of the sale value of the exempted final products; more so, in view of the amendment to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... vice does not arise at all. 7. At this stage, we find that as per the learned advocate, the appellant has reversed the entire input credit availed by them, irrespective of their use in the taxable or exempted services. We agree with him that only the Cenvat credit in respect of input services relatable to their uses in the exempted services is required to be reversed on proportionate basis. As such, we set aside the impugned order and remand the matter to Original Adjudicating Authority for calculation of the credit to be reversed by the assessee. 8. As regards penalty, we agree with the learned advocate that there being a bona fide issue of interpretation of legal provisions as also for appreciating the fact that the credit was availed b ..... X X X X Extracts X X X X X X X X Extracts X X X X
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