2015 (12) TMI 1607 - AT - Service Tax

CENVAT credit - Non-maintenance of separate accounts with regard to input and input services - Held that - For dropping the show cause notice proceedings, the adjudicating authority in the order dated 11.4.2012 has held that the assessee is required to maintain proper records for taking and utilization of Cenvat credit in compliance of the provisions of Rule 9(2) of the said Rules, which do not prescribe any separate record in respect of dutiable goods and taxable services. The only provision for maintenance of separate records under the Cenvat Credit Rules, 2004, I could not find under Rule 6(2) for the said rules, which provides separate records for the dutiable goods or taxable service and the exempted goods/services. This was not the situation in this case as the goods manufactured and services provided by the assessee were not exempted. Thus, I do not see any violation in maintenance of common record for Cenvat credit taken & utilized by the assessee. Since the adjudicating authority on proper analysis of the facts involved in this case has arrived at the above conclusion, I am of the opinion that the views taken by the authorities below cannot be interfered at this juncture since the issue involved is factual in nature - appeal dismissed - decided against Revenue.

Summary

Issues: Non-maintenance of separate accounts for input and input services

Analysis:
The case revolves around the non-maintenance of separate accounts for input and input services, leading to show cause notice proceedings. The adjudication order dated 11.4.2012 dropped the proceedings, a decision upheld by the ld. Commissioner (Appeals) in the impugned order dated 28.11.2014, prompting the appeal before the Tribunal.

Adjudicating Authority's Findings:
The adjudicating authority, in the order dated 11.4.2012, emphasized the requirement for proper records for utilizing Cenvat credit under Rule 9(2) of the Cenvat Credit Rules, 2004. Notably, there was no specific provision mandating separate records for dutiable goods or taxable services under Rule 6(2) of the said rules. Since the goods and services involved were not exempted, maintaining a common record for Cenvat credit utilization was deemed compliant. The burden of proof under sub-rules (5) and (6) of Rule 9 was acknowledged, but as the notice didn't question the credit's admissibility, the authority permitted the utilization of credit earned for dutiable goods towards service tax payment and vice versa.

Tribunal's Decision:
After hearing both sides and reviewing the records, the Tribunal affirmed the adjudicating authority's conclusion and the Commissioner (Appeals)' decision. Given the factual nature of the issue and the authorities' thorough analysis, the Tribunal declined to interfere with the impugned order. Consequently, the appeal filed by the Revenue was dismissed.

This detailed analysis of the judgment highlights the significance of maintaining proper records for Cenvat credit utilization, the absence of a specific requirement for separate records in this case, and the Tribunal's decision based on the factual nature of the issue and the authorities' findings.