TMI Blog2023 (11) TMI 468X X X X Extracts X X X X X X X X Extracts X X X X ..... e market, a lot of research has to be undergone and a number of tests are to be conducted before releasing in the market. In view of these facts, the respondent is engaged in the manufacturing of drug also - Besides this, the Ld. Commissioner has also come to the conclusion that even for conducting research and development, the respondent is registered under the service tax and is paying service tax and therefore the respondent is entitled to cenvat credit - the cenvat credit on inputs and capital goods have been rightly availed by the respondent. Time Limitation - HELD THAT:- The Ld. Commissioner has considered this issue in detail and has come to the conclusion that the entire demand is barred by limitation. There is no infirmity in the impugned order - Appeal of Revenue dismissed. - MR. S. S. GARG, MEMBER (JUDICIAL) AND MR. P. ANJANI KUMAR, MEMBER (TECHNICAL) Shri Aneesh Dewan, DR for the Appellant Shri Surjit Bhadu, Advocate for the Respondent ORDER The present appeal has been filed by the Revenue against the impugned order dated 23.02.2012 whereby the Ld. Commissioner has vacated the show cause notice issued to the Respondent and dropped the pr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ment. He further submits that in the write up dated 14.11.2011, the officer of the appellant have admitted that only technology for various new drugs is being developed at R D centre at Mohali and manufacturing of the developed drugs is undertaken in their manufacturing unit at Derabassi. He also submits that Annual Report of the Respondent for the year 2010-11 also shows that the Respondent has stated that the Mohali facility was exclusively engaged in R D activity. He further submits that there is no time period specified in the Rule or Notification for revocation of the registration issued by the department. He further submits that the findings of the adjudicating authority that the appellant was otherwise entitled to CENVAT credit in respect of service for which the said credit was utilized i.e. Scientific and Technical Consultancy Services. He further submits that the CENVAT credit was ab initio not admissible because the registration for Scientific and Technical Consultancy Services was obtained in 2007. He also submits that Scientific and Technical Consultancy Services was provided by the Respondent to its own units and therefore, the services to oneself is not taxable servi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... itness. The Ld. Counsel also highlighted that in the manufacture of drugs a lot of processes and quality controls are provided under the Drugs and Cosmetics Act and without following the said processes drugs cannot be cleared in the market. Ld. Counsel also submits that without prejudice to his other submissions, the Respondent is entitled to cenvat credit on capital goods as well as on inputs even if it is involved only in the research and development work; ld. Counsel also submits that at the time of obtaining the registration, the Revenue authorities have verified all the documents of the Respondent and if in any case during the verification, it is found that the respondent does not have proper facility of manufacturing then the registration granted can be cancelled; ld. Counsel further submits that the revenue has admitted that the respondent is registered with the department for providing taxable service under the head Scientific and Technical Consultancy Service and have been regularly paying service tax. The Respondent has also been regularly filing Service Tax Returns which has been duly assessed and no objection was ever raised and it is not the case of the department that ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... The Noticees took the CENVAT credit during the period between January 2006 and March 2009. During this period the Noticees had filed the statutory Returns and maintained their records as required under the law. The statutory Returns filed by the Noticees were scrutinized and assessed by the competent revenue authorities. No objection with respect to any information given under the statutory Returns, was ever conveyed to the Noticees. In the statutory Returns, the Noticees had clearly mentioned about the CENVAT credit availed and utilized by them. For the period of over 3 years the revenue authorities had the knowledge about the taking and utilization of CENVAT credit by the Noticees. The revenue authorities did not convey to the Noticees any illegality or irregularity in availing of or utilization of the CENVAT credit. When the fact of taking and utilization of CENVAT credit was already within the knowledge of the revenue authorities, the allegation of suppression of facts cannot, legitimately, be made against the Noticees. If the revenue authorities had any objection with respect to the right of the Noticees to take or utilized the CENVAT credit then appropriate action should have ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ths from the relevant date. But this period to commence proceedings under proviso to the Section stands extended to five years if the duty could not be levied or it was short-levied due to fraud, collusion, wilful misstatement or suppression of facts etc. The proviso to Section 11A reads as under Provided that where any duty of excise has not been levied or paid or has been short- levied or short-paid or erroneously refunded by reason of fraud, collusion or any wilful misstatement or suppression of facts, or contravention of any of the provisions of this Act or of the rules made thereunder, with intent to ovade payment of duty, by such person or his agent, the provisions of this sub-section shall have effect, as if for the words Central Excise Officer , the words Collector of Central Excise and for the words six months , the words five years were substituted. A bare reading of the proviso indicates that it is in nature of an exception to the principal clause. Therefore, its exercise is hedged on one hand with existence of such situations as have been visualised by the proviso by using such strong expression as fraud, collusion etc, and on the other hand it should hav ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ew of the proviso to sub-section 11A of the Act, it has to be established that the duty of excise has not been levied or paid or short-levied or short-paid, or erroneously refunded by reasons of either fraud or collusion or wilful misstatement or suppression of facts or contravention of any provision of the Act or Rules made thereunder, with intent to evade payment of duty. Something positive other than mere inaction or failure on the part of the manufacturer or producer or conscious or deliberate withholding of information when the manufacturer knew otherwise, is required before it is saddled with any liability, beyond the period of six months. Whether in a particular set of facts and circumstances there was any fraud or collusion or wilful misstatement or suppression or contravention of any provision of any Act, is a question of fact depending upon the facts and circumstances of a particular case. (emphasis supplied) Accordingly, something positive other than mere inaction or failure to pay the tax on the part of the service provider is required. The taking of credit should have been accompanied with conscious or deliberate withholding of information that the Noticees were no ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
