2018 (6) TMI 580 - AT - Central Excise

Rectification of Mistake - It has been argued that the order allows revenue s appeal on the ground that there is revenue neutrality while the impugned order clearly holds that during proceedings before lower authority they had pointed out that they were reversing the credit attributable to trading activities - Held that - The Tribunal order dated 05.12.2017 in para 5.1 and 5.2 deals with the aspect of revenue neutrality and it also points out that the order of Commissioner (Appeals) is silent on the aspect of applicability of Rule 7 of the Cenvat Credit Rules to the facts of the case. In view of the assertion made by the applicants - the applicants before the lower authorities have made out a case that they have been reversing the cenvat credit on the trading activities. Moreover, the aspect of Rule 7(c) of the Cenvat Credit Rules have not been examined by the lower authorities. The order is therefore modified by rectifying the mistake - ROM Application allowed.

Summary

Issues involved: Rectification of Mistakes in a Tribunal Order

Analysis:
- The applications for Rectification of Mistakes were filed by M/s. SKF India Ltd. concerning Order no. A/91397-91398/17 dated 05.12.2017.
- The argument presented was that the order allowed revenue's appeal based on revenue neutrality, while it was contended that during proceedings before the lower authority, they had highlighted the reversal of credit attributable to trading activities. Additionally, it was argued that services like renting of immovable property and landline telephone services are essential for promoting and marketing business and should be considered as input services.
- Upon examination, the Tribunal found that the order dated 05.12.2017 did not address the applicability of Rule 7 of the Cenvat Credit Rules to the case. The applicants had demonstrated that they were reversing the cenvat credit related to trading activities, and the aspect of Rule 7(c) had not been adequately analyzed by the lower authorities.
- Consequently, the Tribunal modified the order by rectifying the mistake, deleting certain paragraphs, and inserting new ones. The revised paragraphs highlighted the reversal of cenvat credit attributable to trading activities and emphasized that the credit of service tax on renting of immovable property and landline telephone services was specific to certain branches, falling under Rule 7(c) of the Cenvat Credit Rules.
- The impugned order was set aside, and the appeal was allowed by remanding it to the Commissioner (Appeals) for a reevaluation of the applicability of Rule 7(c) to the case.
- Ultimately, the Rectification of Mistake applications were allowed as per the terms specified, with the judgment pronounced in court on 8/5/18.