2023 (1) TMI 806 - AT - Service Tax

CENVAT Credit - demand raised on the difference of Cenvat credit balance shown as of June, 2017, in their ST-3 returns and the actual closing balance - claim of the appellant is that certain Cenvat credit was left to be shown in ST-3 returns for the month of June, 2017 - whether the credit claimed by the appellant for Rs. 31,67,294/- is correct or otherwise? - HELD THAT - On perusal of the original order as well as other documents, it is found that appellant have submitted statement, wherein complete details was given about the Cenvatable documents. It is also observed that the balance of Cenvat Credit considering the credit of Rs. 31,67,294/- was also declared in the books of accounts by the appellant. This evidence cannot be brushed aside on the presumption that the appellant might have taken the credit earlier unless it is proved by the revenue. Therefore, the detail submitted by the appellant along with copies of invoices no doubt can be raised that the appellant were entitled for the Cenvat credit of Rs. 31,67,294/- on consideration of this credit the balance remains is only Rs. 37,321/- which has been paid along with interest, with this payment there is no demand exist. The appellant are entitled for the Cenvat credit of Rs. 31,67,294/- - the demand raised in the impugned order except the demand of Rs. 37,321/- , does not sustain - appeal allowed - decided in favor of appellant.

Summary

Issues:
Demand raised on the difference in Cenvat credit balance shown in ST-3 returns and actual closing balance.

Analysis:
The appellant faced a demand of Rs.17,59,069/- due to discrepancies in the Cenvat credit balance shown in the ST-3 returns compared to the actual closing balance. The appellant argued that system glitches prevented the update of credit worth Rs. 31,67,294/- in the returns, leading to the difference. The appellant contended that the correct closing balance should be Rs. 1,18,74,757/- after considering the unupdated credit. They paid the excess balance of Rs. 37,321/- along with interest. The Commissioner (Appeals) rejected the appellant's submission, citing lack of evidence that the credit was not previously claimed. The appellant, being a Government Organization, emphasized their credibility. The Tribunal noted that the demand was based on the Cenvat credit balance difference in the returns. After reviewing the evidence submitted by the appellant, including detailed statements and invoices, the Tribunal found that the appellant had indeed declared the credit in their books. The Tribunal opined that without proof from the revenue, the appellant's entitlement to the credit of Rs. 31,67,294/- cannot be questioned. Consequently, the Tribunal allowed the appeal, modifying the impugned order to sustain only the demand of Rs. 37,321/-, which was already paid by the appellant. The decision was pronounced on 19.01.2023.