TMI Blog2024 (3) TMI 1040X X X X Extracts X X X X X X X X Extracts X X X X ..... applicable to the period of the present show cause notice. During the period of present show cause notice, there was no whisper of trading in Chapter V of Finance Act, 1994 which deals with the provisions of law related to levy of service tax. There was no provision of law for disallowance of cenvat credit availed on service tax paid on input services which also were utilized for trading activity during the relevant period - part of the impugned order through which cenvat credit of Rs.1,97,62,992/- was disallowed is set aside. Once the said cenvat credit is held to be admissible, then there is no question of short payment of service tax as held in the impugned order. The impugned order set aside - appeal allowed. - HON BLE DR. SUVENDU KU ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n account of service tax paid on services attributable to trading activity was Rs.2,04,32,187/- and the same was not eligible to be availed by the appellant and, therefore, the same was proposed to be recovered under the provisions of Rule 14 of Cenvat Credit Rules, 2004. It was also alleged in the said show cause notice that out of the said cenvat credit, an amount of Rs.1,10,65,019/- was utilized towards payment of service tax on output services like business auxiliary services and since the said credit itself was not admissible, there was short payment of service tax to the above stated extent and, therefore, the said amount was demanded as short paid service tax under Section 73 of Finance Act, 1994. Appellant contested the said show ca ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the same was not eligible because common input services were used for manufacture as well as trading activity. He has further confirmed the demand of service tax of Rs.1,03,95,824/-. Aggrieved by the said order, appellant is before this Tribunal. 2. Heard the learned counsel for the appellant. He has contended that the definition of exempted services from 2006 to 01.04.2011 was provided by Section 2(e) of Cenvat Credit Rules, 2004 and the same was amended with effect from 01.04.2011 and for the first time an explanation was added to the said definition stating that trading was exempted services. He has stated that before 01.04.2011, i.e. during the period of present dispute, there was no provision in the law that trading was a service at al ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s, cenvat credit availed was admissible to the appellant and as a result, demand of short paid service tax did not sustain. As a consequence, he has submitted that interest and penalties are also not sustainable. 3. Heard learned AR for Revenue who has supported the impugned order. 4. We have carefully gone through the record of the case and submissions made. We note that the show cause was issued on the premises that trading was exempted service and common input services were used by the appellant towards manufacture of the goods, providing taxable service and also providing trading and, therefore, cenvat credit availed on service tax paid on attributable services to trading was proposed to be reversed. Some part of the said cenvat credit ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the period prior to 01.04.2011. Therefore, the definition of exempted services with effect from 01.04.2011 is not applicable to the period of the present show cause notice. During the period of present show cause notice, there was no whisper of trading in Chapter V of Finance Act, 1994 which deals with the provisions of law related to levy of service tax. We, therefore, hold that there was no provision of law for disallowance of cenvat credit availed on service tax paid on input services which also were utilized for trading activity during the relevant period. We, therefore, set aside that part of the impugned order through which cenvat credit of Rs.1,97,62,992/- was disallowed. Once the said cenvat credit is held to be admissible, then the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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