Percept H. Pvt. Ltd. Versus CCGST Mumbai
Service Tax
2018 (7) TMI 93 – CESTAT MUMBAI – TMI
CESTAT MUMBAI – AT
Dated:- 21-6-2018
Appeal No. ST/88138/17 – Order No. A/86777 / 2018
Service Tax
Hon'ble Dr. Suvendu Kumar Pati, Member ( Judicial )
Shri Keval Shah, Advocate for the appellant
Shri Vivek Dwivedi, AC (AR) for the respondent
ORDER
Refusal of cenvat credit already availed by appellant advertising company on the input services to the tune of Rs. 8,08,800/- after audit report indicated it as inadmissible credit is under challenge in this appeal consequent upon unsuccessful attempt before the Commissioner (Appeals) challenging the legality of the order of the first adjudicating authority demanding such tax along with interest and penalty.
2. The appellant is in the business of advertising and had availed input credits on same category and other category services during the period July 2013 to September 2013. Departmental audit conducted thereafter pointed ou
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of such cenvat credit as inadmissible along with interest at appropriate rate and penalty of same amount demanded.
3. In his memo of appeal and during course of hearing of appeal, the ld. Counsel for the appellant Shri Keval Shah submitted that the Ld. Commissioner has erred in not allowing cenvat credit and also erred in invoking the extended period of limitation without proper appreciation of the rules framed for the same and the position of law developed through judicial decisions reported in CCE vs. Data Infosys Ltd. 2006 (4) STR 34 (Tri-Del) and Gopal Zarda Udyog vs. CCE 2005 (188) ELT 251 (SC) for which the order of confirmation of demand along with interest and penalty passed by the first appellate authority is required to be set aside.
4. On the other hand, the respondent department has not filed any cross objection but during course of hearing of appeal has drawn the attention of this court to the amended Rule of 2002 referred above under which two categories of services are
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cludes interpretation of cenvat credit in respect of input services used for providing of output services. Ld. Counsel for the appellant was appraised that such interpretation concerning the classification of services is not within the competency of this single bench jurisdiction to which he replied that he would accept the order of the adjudicating authority to the extent that services upheld by the appellant to the tune of amount involved in the appeal i.e. Rs. 8,17,561/- can fall under the category of other services and therefore covered under sub-rule (b) of Rule 3 of Cenvat Credit Rules 2002. This being the scenario it is imperative to have a look on the text of amended Rule to arrive at a just decision.
“(ii) in rule 3 –
(A) for sub-rule (1), the following sub-rule shall be substituted, namely –
(1) An output service provider shall be allowed to take credit (herein referred to as service tax credit) of the service tax paid on such input services in the manner, namely :-
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s been referred and the proviso annexed thereof has been ignored by the respondent department and the adjudicating authority as well as appellate authority. In drawing the attention of this court to Annexure A of notice to show-cause which contains a column as the date of payment, the ld. Counsel for the appellant indicated payment in respect of all bills/ invoices were made after 14.05.2003 and therefore his case would be squarely covered under this proviso.
7. I find force in the submission of ld. Counsel for the appellant. It is worthwhile to reiterate that the payment in respect of all bills were made after 14.05.2003 and the cenvat credit was availed by the appellant between July 2013 and September 2013, as found from the appeal memo, which covers the case under proviso annexed to Rule 3. This being the factual scenario, I have no hesitation to hold that appellant had not availed any cenvat credit in violation of Rule 3(1)(b) of Cenvat Credit Rules 2002 (second amendment). Hence
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