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2018 (1) TMI 420 - AT - Central ExciseCENVAT credit - input service - Advertisement and Publicity used on their traded goods - suppression of facts - Held that - it is clearly evident that the department was aware about the availment of input service credit towards advertisement and publicity for brand promotion taken on account of trading goods. So, the allegation made in the SCN dated 04.04.2012 that there is a suppression of fact from the department with intent to evade payment of duty cannot be sustained - Hon ble Supreme Court in the case of Nizam Sugar Factory 2006 (4) TMI 127 - SUPREME COURT OF INDIA observed that when all the relevant facts are in the knowledge of the authorities when the first SCN was issued, the allegation of suppression of facts on the part of the assessee cannot be accepted. N/N. 3/2011 (NT) dated 01.03.2011 - exempted services - trading goods - Held that - the demand of Input Service Credit for the normal period of limitation would be applicable. The SCN dated 05.07.2011 was issued for the period from June 2010 to March 2011 - in the present case, there is no suppression of facts with intent to evade payment of duty or collusion etc. and therefore the demand of duty for the normal period of limitation is to be invoked. Penalty - Held that - There is no suppression of facts with intent to evade payment of duty and therefore imposition of penalty is not justified. Appeal allowed in part.
Issues involved:
Whether the assessee is entitled to avail Cenvat Credit on Input Service Advertisement and Publicity used on traded goods. Detailed Analysis: 1. Facts of the Case and Legal Proceedings: The case involved M/s. Century Plyboards (I) Private Limited, engaged in manufacturing and trading of plywood and veneer. The dispute arose regarding the disallowance of Input Service Credit on Advertisement and Publicity for brand promotion on trading goods. The Commissioner dropped the demand citing the extended period of limitation. Subsequent appeals and cross objections were filed by both parties. 2. Arguments by the Assessee: The Assessee argued that they are entitled to avail credit on trading items prior to 01.04.2011 based on Rule 6(1) of Cenvat Credit Rules. They also contended that there was no suppression of facts as the department was aware of the issue. The Assessee relied on legal precedents to support their case. 3. Revenue's Position: The Revenue claimed that the Assessee did not provide necessary facts and figures, justifying the invocation of the extended period of limitation. They reiterated the findings of the lower authorities. 4. Judgment on Show Cause Notices: The Tribunal noted that a previous Show Cause Notice from 2008 indicated the department's awareness of the input service credit issue. Citing legal precedents, the Tribunal held that there was no suppression of facts by the Assessee. The Gujarat High Court's decision was also referenced to support this conclusion. 5. Decision and Rationale: The Tribunal dismissed the Revenue's appeal, upholding the Assessee's appeal partially. It found that the demand of Cenvat Credit duty for the normal period of limitation was applicable. The Tribunal emphasized that there was no intent to evade payment of duty, leading to the dismissal of the penalty imposition. 6. Final Verdict: The Tribunal dismissed the Revenue's appeal, partly allowed the Assessee's appeal, and set aside the penalty. The judgment was pronounced on 03.01.2018, emphasizing the interpretation of the Act and Rules in the case. This detailed analysis covers the legal issues, arguments presented, relevant legal precedents, and the final judgment delivered by the Appellate Tribunal CESTAT KOLKATA in the cited case.
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