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2018 (8) TMI 691

trading of automobile cars - Rule 6 (3a) of Cenvat Credit Rules, 2004. - Held that:- It is a matter of record that the appellant has been engaged in trading of automobile cars along with servicing of the cars and other automobile from the same premises and they have availed Cenvat Credit of various common input services which has been utilised towards both taxable services as well as for trading activity - trading activity abinitio cannot be considered as a “service” because the trading in the cars only involves transfer of property on financial consideration from the appellant dealer to various buyers of automobile cars. The Cenvat Credit facility of input services is only available to the output services rendered by any assessee and t .....

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nsidered as a service and thus same is beyond the scope of Finance Act, 1994 as well as the provisions of Cenvat Credit Rules, 2004. The Department in the show cause notice has also mentioned that since the respondent i.e. the appellant-assessee did not maintain separate accounts for input services used towards the trading activity (exempted activity) and that towards servicing of cars, therefore, the appellant are required to pay an amount of Cenvat Credits in terms of Rule 6 (3a) of Cenvat Credit Rules, 2004. 2. The Ld. Advocate appearing on behalf of the appellant has contended that activity of trading has come to be included as an exempted category service only w.e.f. 01/04/2011 by way of amendment carried out in the Cenvat Credit Rules .....

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ich were exempt from whole of Service Tax and, included those services on which Service Tax was not leviable, under Section 66 of the Finance Act. The inclusion in Explanation to Rule 2(e) trading was, without doubt, only clarificatory. As accepted by Mr. Jayachandran, the appellant had not being paying Service Tax on trading activity during the relevant period. We have also relied upon the order of this Tribunal in case of Lally Automobiles Pvt. Ltd. V/s Commissioner of Service Tax, Delhi 2018 (10) GSTL 310 (Tri.-Del). The relevant extract of the judgment are reproduced herein below:- 6. We have heard both the sides and perused appeal records. The admitted facts are that the appellants availed Cenvat credit on input services and they had c .....

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