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TMI Blog2024 (3) TMI 756X X X X Extracts X X X X X X X X Extracts X X X X ..... the Order-In-Original, the appellant filed an appeal before the Commissioner (Appeals) which came to be rejected by concurring with the view taken by the Adjudicating Authority. Therefore, the present appeal. 2. Shri Harishankar Pandya, Legal Manager of the appellant's company appeared and submits that firstly, there was dispute about the payment of service tax on ocean freight and despite that the appellant had paid the amount along with interest, therefore, there is no suppression of fact on the part of the appellant, hence, the refund could not have been rejected by invoking Rule 9 (1) (bb) of Cenvat Credit Rules, 2004. He placed reliance on the decision of this Tribunal in the case of Pacific Harish Industries vide Final Order No. A/ 11904/2019 dated 10.10.2019. 3. Shri Anoop Kumar Mudvel, Learned Superintendent (AR) appearing on behalf of the Revenue reiterates the finding of the impugned order. 4. I have carefully considered the submission made by both sides and perused the records. I find that the refund claim was rejected by both the lower authorities on the ground that the payment of service tax on ocean freight is by way of suppression of fact and therefore, in terms o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nder Section 73 (1) ibid. The adjudicating authority in the impugned order has confirmed demand of the said amount availed by the appellants as being ineligible input service tax credit taken by them. We find that entire demand relates to Rule 9 (bb) of the CCR 2004 which reads as under : "A supplementary invoice, bill or challan issued by a provider of output service, in terms of provisions of service tax rules, 1994 except where the additional amount of tax became recoverable from the provider of service on account of non-levy or non-payment or short-levy or short-payment by reason of fraud or collusion or wilful mis-statement or suppression of facts or contravention of any of the provisions of the finance act or the rules made there under with the intent to evade payment of tax." Since the tax amount of Rs.6,21,24,362/- has been paid by them under reverse charge mechanism which specifically fits under Section 9 (e) ibid, the credit has therefore been availed by the appellants not under Rule 9 (bb) but under Rule 9 (e) of the CCR 2004. We find this contention to be correct in law. There is no doubt that the demand of Rs.6,21,24,362/- was made under the premise that the same w ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r under Rule 9(1)(b) of Cenvat Credit Rules, 2004. The word "Challan" and "any other similar document" evidencing payment of additional CVD, mentioned in Explanation to Rule 9(1)(B), will thus mean these situations where duty is paid under a "challan" by an importer/dealer of imported goods who has sold the cenvatable goods. This provision relating to issue of supplementary invoice will not be applicable to the goods imported by the appellant which are not sold. This interpretation has been upheld by Karnataka High Court in the case of Karnataka Soaps & Detergent Ltd. v. CCE, Mysore [2010 (258) E.L.T. 62 (Kar.)]. The argument of the ld. A.R. that the "Explanation" added to Rule 9(1)(b) of the Cenvat Credit Rules, 2004 was not existing when Karnataka High Court delivered the above judgment is not tenable because an "Explanation" introduced in the Rule can only clarify the provisions of Rule 9(1)(b), which involve sale of goods and cannot elaborate the scope of Rule 9(1)(b) of the Cenvat Credit Rules, 2004. In the case of import, assessment of duty is always paid by an importer under the challans and endorsement to that effect is made on the body of Bill of Entry. In the present fact ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... recoverable from the provider of service on account of non-levy or non-payment or short-levy or short-payment by reason of fraud or collusion or wilful misstatement or suppression of facts or contravention of any of the provisions of the Finance Act or of the rules made thereunder with the intent to evade payment of service tax." 5. From the plain reading of the above Rule 9(1)(bb) it is observed that the credit can be denied only if the short payment or non-payment for the reason of fraud or collusion or willful mis statement or suppression of fact or contravention of any of the provisions of the finance Act or Rules made there under with intent to evade payment of Service Tax. In the facts of the present case the appellant have paid the Service Tax along with l5% penalty and interest in terms of Section 73 (4A) it reads as under: "In case where ingredients of fraud, collusion etc., as per section 73(4) exists, then the assessee can pay the service tax along with interest and penalty equal to 1 percent of the tax for each month for the period which default continues, up to maximum of 25 percent . In case, the assessee have paid service tax, interest and penalty under section 7 ..... X X X X Extracts X X X X X X X X Extracts X X X X
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