TMI Blog2022 (9) TMI 130X X X X Extracts X X X X X X X X Extracts X X X X ..... r continued maintenance of the credit availed. In the absence of details of credit taken during the disputed period and utilized, we are unable to come to conclusion of the reversal, if any, required under the CENVAT Credit Rules, 2004. It would, therefore, be appropriate for the notice to be decided afresh by the original authority - matter remanded back to the original authority to consider the submissions of the assessee. - SERVICE TAX APPEAL NO: 88091 OF 2017 - FINAL ORDER NO: A/85825/2022 - Dated:- 1-9-2022 - MR C J MATHEW, MEMBER (TECHNICAL) AND MR AJAY SHARMA, MEMBER (JUDICIAL) Shri Shailendra Jain, Chartered Accountant for the appellant Shri Nitin Ranjan, Deputy Commissioner (AR) for the respondent ORDER M/ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... le to use in providing exempted service or payment at prescribed rate on the total value of exempted service had undergone change for the period after 1st April 2008 when the compliance involved utilizing only twenty percent of total tax to be discharged through the CENVAT credit route was substituted. According to tax authorities, the exemption of interest and discount of cash credit, overdraft, bill discounting facilities etc. in terms of notification no. 29/2004-ST dated 22nd September 2004 precluded the availment of credit to the extent utilized in rendering these services as provider of banking and other financial services taxable under section 65 (105) (zm) of Finance Act, 1994. 3. It was held by the lower authorities tha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 017 disposing of appeal no. ST/50665/2017 against order-in-appeal no. BHO-EXCUS-002-APP-308-16-17 dated 21st December 2016 of Commissioner of Central Excise, Customs Service Tax (Appeals), Raipur] and in Aditya College of Competitive Exam v. Commissioner of Central Excise, Visakhapatnam [2009 (16) STR 154 (Tri-Bang)]. The decision of the Tribunal in Sudhakar Plastic Ltd v. Commissioner of Central Excise, Hyderabad [2010 (20) STR 792 (Tri-Bang)] was relied upon to dispute the scope for imposition of penalties under section 76 and section 78 of Finance Act, 1994 for availment of CENVAT credit. 5. Learned Authorized Representative contended that the appellant had not maintained separate accounts on consumption of services for taxable and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pt service. This will require reversal of credit used for earning such income. For the banking and financial sector, provisions are available to reverse credit up to 50% in Rule 6(3D). It is being proposed to change this formula to actual basis, the value of service being net interest earned less interest paid on deposits, subject to a minimum of 50% of interest paid on deposits. For the non-financial sector it is being proposed that they may reverse credits on gross interest basis. From the above clarification and I also read amendment Notification No. 11/2012-S.T., dated 17-3-2012, interest, prior to 17-3-3012 was excluded from the taxable value and thereafter it was explicitly made exempted. Therefore the Board has clarified that a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tire Service Tax along with interest under Rule 6(3)(ii), appellant could not be asked to pay any further additional amount. I also find that there were nationwide cases against many assessees on this issue and it was observed that as against petty amount of Cenvat credit huge amount of lacs and crores were demanded from the assessee invoking provisions of Rule 6(3). After realizing serious anomaly in the provisions the Government brought retrospective amendment in Rule 57CC of Central Excise Rules, 1944 and Rule 6 of Cenvat Credit Rules, 2002/2004. According to said retrospective amendment in all such cases option was given to the assessee that if the assessee opt for payment of an amount of Cenvat credit attributable to the exempted goods ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... also altogether different facts in the present case. For this reason also Hon ble Bombay High Court judgment in the case of Nicholas Piramal (supra) is not applicable in the present case, hence distinguished. In view of my above discussion, I am of the view that demand raised under Rule 6(3)(i), CCR, 2004 is not sustainable. Therefore the impugned order is set aside. Appeal is allowed. 7. It would, therefore, appear that the lower authorities had not considered the manner in which the reversal was to be handled as per rule 6 of CENVAT Credit Rules, 2004 and that exempted services , as defined in rule 2 of CENVAT Credit Rules, 2004, should have been the basis for determining the ineligibility for continued maintenance of the credit ava ..... X X X X Extracts X X X X X X X X Extracts X X X X
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