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2024 (5) TMI 803 - AT - Service TaxReversal of CENVAT Credit - units sold after the Completion Certificate (CC) - exempt services or not - scope of SCN - HELD THAT - The Grounds taken by the Revenue before the Commissioner (Appeals) is not known since neither side has filed the copy of the Revenue s Review Order Order and Grounds taken by the Revenue. The Commissioner (Appeals) has passed the Order to the effect that the Appellant is not eligible to take full Cenvat Credit since they were also providing exempted service in the form of sale of units after the issuance of Completion Certificate. He has also dealt with the issue as to whether the Appellant can take the benefit of Cenvat Credit as well as abatement when they are following the procedure given under Notification No. 1/2006-St as amended from time to time. As to whether the Commissioner (Appeals) has traversed beyond the scope of SCN can be seen only after going through the Department s Grounds before him are considered, which presently is not available to the Bench. Since the Show Cause Notice addressed several issues about the credit taken, return shown in the ST-3 etc., it would be important to get these facts verified. In the absence of all the documents being placed before the Bench, it would not be fair to come to conclusion at this juncture. Accordingly, in the interest of justice, the matter is remanded to the Adjudicating Authority to get all the documentary evidence including the Audit Report, Grounds taken by Revenue before the Commissioner (Appeals), properly verified and pass a considered decision. Matter on remand.
Issues involved:
The issues involved in this case are related to the Appellant claiming Cenvat Credit for construction services, the reversal of Cenvat Credit amount, denial of refund by the Adjudicating Authority, and the subsequent appeal before the Commissioner (Appeals) resulting in the denial of refund to the Appellant. Issue 1: Cenvat Credit and Service Tax Liability The Appellant, providing construction services, claimed Cenvat Credit and used it to discharge their Service Tax liabilities. The dispute arose when units remained unsold until the Completion Certificate (CC) was issued, leading to the belief that no Service Tax was required to be paid post-CC issuance, as it equated to the sale of completed units. An audit by the Service Tax Commissionerate concluded that the Appellant wrongly claimed Cenvat Credit for exempted services, necessitating a reversal of Rs. 22,05,781 under Rule 6(3A) of Cenvat Credit Rules, 2004. The Appellant paid a portion through Cenvat Credit reversal and the remainder via GAR-7 Challans. Subsequently, the Appellant recalculated the reversal amount to be Rs. 2,19,499, seeking a refund of the excess paid amount. Issue 2: Show Cause Notice and Refund Denial A Show Cause Notice was issued, prompting the Appellant to respond by explaining their Service Tax discharge under specific notifications and contesting the audit findings regarding the Cenvat Credit reversal amount. The Adjudicating Authority initially sanctioned the refund of Rs. 14,91,849, which was challenged by the Department in an Appeal before the Commissioner (Appeals). The Commissioner (Appeals) overturned the refund decision, leading to the Appellant's appeal before the Tribunal. Resolution and Remand After hearing both sides, the Tribunal observed discrepancies in the Cenvat Credit availed by the Appellant and the issues raised in the Show Cause Notice. Noting the absence of crucial documents, including the Audit Report and Revenue's grounds, the Tribunal remanded the matter to the Adjudicating Authority for further verification and a considered decision. The Tribunal emphasized the importance of proper verification and completion of Denovo proceedings within four months to address the issues related to Cenvat Credit and Service Tax liabilities for the year 2012-13. This summary encapsulates the key legal aspects and proceedings of the judgment by the Appellate Tribunal CESTAT KOLKATA, highlighting the issues, responses, and the Tribunal's decision for each issue involved in the case.
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