TMI Blog2020 (7) TMI 2X X X X Extracts X X X X X X X X Extracts X X X X ..... mber, 2012; the learned Commissioner has erred in holding that banking and financial services, credit rating services are not used for providing output services; such services are required to raise funds, which is essential to carry out the business of the appellant and hence the same is held to be eligible service; as regards the allegation that certain processing charges/banking service was related to GMR Infrastructure Limited (subsidiary company) as reflected in additional credit arrangement letter of the bank, whereas the invoice is in the name of the appellant towards loan processing fee; as the appellant company benefits from profitability and working of subsidiary company, thus the banking and financial charges are eligible input service in respect of the appellant - there is no specific reason assigned for disallowance of Cenvat credit for other input services by the learned Commissioner. Penalty - HELD THAT:- There are no case of suppression, fraud, etc. is made out against the appellant; further, admittedly appellant have maintained proper books of accounts and registers of the transactions and also regularly filed the ST-3 returns and paid the admitted taxes; further ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... consumption and inventory of input services for provision of taxable output services and for provision of exempt services, as well as for utilization; thus, the appellant/assessee appeared liable to pay an amount attributable to the Cenvat credit on inputs services used in the exempt output services, at the specified rate in Rule 6(3) of CCR, for the period 1.4.2008 to 31.3.2012; the Revenue calculated the amount payable as below: Sl. No. Period Value of exempted services provided Rate of Cenvat credit to be reversed Amount to be Reversed A B C D 1. 2010-11 ₹ 3,84,30,39,918 6 ₹ 23,05,82,395 2. 2011-12 ₹ 8,80,58,22,801 5 ₹ 44,02,91,140 Total ₹ 67,08,73,535/ Year ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 4 . Accordingly, Show Cause Notice, alleging suppression of facts and contravention of Act read with rules, invoking extended period of limitation, was issued; further another show cause notice, dated 21.5.2014 for the period April, 2012 to June, 2013 was also issued, The adjudicating authority passed common order in original including the subsequent, being impugned order in original dated 1.6.2016. The details of the show cause notice, period in dispute and the demands confirmed vide the impugned order are as follows, which are appealed against by the appellants. Sl. No. Demands confirmed Appeal No. 21325/2016 SCN dated 23.4.2013 Period 10/2007 to 3/12 (Rs.) 21326/2016 dated 21.5.2014 4/12 to 6/13 (Rs.) 1. Service tax on construction of toll plaza, administrative Buildings, rest rooms, parking bays etc. 3,77,03,996 7,04,71,970 2. Under Rule 6(3) of CCR 1,94,46,310 (Appropriated) 3. Cenvat Cr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tive building etc. is for the basic purpose of maintenance and safety of the road as well as collection of toll towards recovery of cost, the same cannot by any stretch of imagination be considered a separate commercial activity; further, these constructions are on turnkey basis along with the road. The learned Counsel relies on the following cases. Larsen and Toubro Limited Vs. Union of India 2009 (248) ELT 170 (Bom) , wherein it was held that turnkey agreements are to be seen as one agreement which involves series of other incidental and inseparable activities, which otherwise may be taxable if undertaken separately. Archi-structural Constructions India P. Ltd. Vs. CCE, Coimbatore 2011 (22) STR 663 (Tri- Chennai) , wherein Air catering unit constructed under the indivisible EPC contract for Airport, was held to be part of Airport and not taxable separately. Delhi Bench of Tribunal in DIAL Vs. Commissioner of Service Tax, Delhi held that the advance development fees received by DIAL from lessees in the Aero City area, Delhi Airport, for providing and constructing common facilities was held to be non taxable as such activity was held to be within the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ,94,46,310/- was disallowed holding that the appellant is required to reverse Cenvat credit attributable or used in providing exempt services by way of reversal; Learned Counsel points out that the said amount is not disputed and was already reversed on 21 September, 2012, prior to issue of show cause notice and the same stands appropriated along with interest of ₹ 24,69,859/-. 9. The next ground is in regard to an amount of ₹ 7,58,737/- alleged to be double credit taken by the appellant. We find that the appellants have reversed the amount prior to issue of show cause notice and the same has been appropriated in the adjudication order. The appellants did not dispute. 10. The next ground is regarding disallowance of Cenvat credit of ₹ 5,81,31,723/- in show cause notice dated 23.4.2013 and ₹ 3,39,24,751/- in show cause notice dated 21.4.2014. Learned Counsel urges that the Cenvat credit disallowed comprises as follows: Nature of Services Amount (4/12 to 6/13) 07-08 to 11-12 Advertising and marketing ₹ 21,477/- ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e allegation that certain processing charges/banking service was related to GMR Infrastructure Limited (subsidiary company) as reflected in additional credit arrangement letter of the bank, whereas the invoice is in the name of the appellant towards loan processing fee; we hold that as the appellant company benefits from profitability and working of subsidiary company, thus the banking and financial charges are eligible input service in respect of the appellant. We find that there is no specific reason assigned for disallowance of Cenvat credit for other input services by the learned Commissioner. Accordingly, we allow this ground in favour of the appellant and against the Revenue. 11 . The next ground regarding imposition of penalty under Section 78 of the Finance Act for both the periods in dispute; Learned Commissioner has observed that the appellant failed to disclose the taxable activity of construction of toll plaza, administrative building etc to the department in their ST-3 returns, with an intention to evade payment of service tax and hence extended period of limitation is invocable; it is further held that the appellant have not disclosed availment of Cenvat credit in ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
