2024 (8) TMI 605 - AT - Service Tax

CENVAT Credit - mismatch between the Cenvat credit register and the credit taken in the ST-3 returns filed by the appellant - amount of Rs. 12, 12, 894/- taken in the month of June 2017 on the strength of invoices allegedly issued in July 2017. CENVAT Credit - mismatch between the Cenvat credit register and the credit taken in the ST-3 returns filed by the appellant - HELD THAT - It is seen that Commissioner (Appeals) has not examined any facts whatsoever he has simply confirmed the demand. Ideally he should have called for list of the documents on which the Cenvat credit has been taken and compared with the total credit taken. From the data submitted by the appellant it is apparent there is no mismatch but only a technical difference. The impugned order is set aside and the matter remanded to the adjudicating authority to call for the invoices from the period October 2015 to March 2016 and compare the credit taken with invoices. If there is any mismatch in that the demand can be confirmed if there is no mismatch then Cenvat credit should be allowed. CENVAT Credit - amount of Rs. 12, 12, 894/- taken in the month of June 2017 on the strength of invoices allegedly issued in July 2017 - HELD THAT - It is seen that the arguments raised by the appellant including ground about the Circular F. No. 137/16/2017-Service Tax dated 28th September 2017 has been totally ignored by the Commissioner (Appeals). Prima facie the issue seems to be covered by the Circular cited by the appellant however for a closure scrutiny with the relevant invoices the matter needs to be remanded to the original adjudicating authority to examine the issue in the light of the circular afresh. The appeal is allowed by way of remand.

Summary

Issues: Appeal on demand of Cenvat credit, mismatch in credit register and ST-3 returns, excess credit amount, Cenvat credit taken in transition period from Excise to GST.

Analysis:
1. Mismatch in Credit Register and ST-3 Returns:
The appeal involved a demand for Cenvat credit by M/s Rajasthan Housing Board based on two issues. The first issue pertained to a demand of Rs. 1,07,946 due to a mismatch between the Cenvat credit register and the credit taken in ST-3 returns. The Chartered Accountant for the appellant explained that the Cenvat credit under 'input RCM' was taken on accrual basis in the register but on a cash basis in the service tax return. The appellant argued that considering the entire period from April 2015 to March 2016 would show lower Cenvat credit in ST-3 compared to the register. The Commissioner (Appeals) confirmed the demand without examining the facts, leading to the order being set aside for further verification by the adjudicating authority.

2. Excess Credit Amount:
The second issue involved an alleged excess Cenvat credit of Rs. 1,07,946 for the period October 2015 to March 2016. The Commissioner (Appeals) upheld the demand without detailed examination. The appellant contended that there was no mismatch, only a technical difference, and requested a comparison of credit taken with invoices. The order was remanded to the adjudicating authority for a thorough examination based on the invoices to determine the validity of the demand.

3. Cenvat Credit in Transition Period:
Regarding the second issue of taking Cenvat credit in June 2017 on invoices issued in July 2017 during the transition from Excise to GST, the appellant relied on a circular allowing such credit during the transitional period. The Commissioner (Appeals) disregarded the circular and confirmed the demand for Rs. 12,12,894. The issue was deemed to be covered by the circular, necessitating a closer examination based on relevant invoices. The matter was remanded to the original adjudicating authority for a fresh assessment in light of the circular.

In conclusion, the appeal was allowed by way of remand for both issues to ensure a detailed examination and verification by the adjudicating authority, considering the technicalities and relevant circulars in the assessment of the Cenvat credit demands.