9911796707
TMI Blog2015 (10) TMI 2198X X X X Extracts X X X X X X X X Extracts X X X X ..... ke Cenvat Credit. Sub rule 4 of Rule 3 of Cenvat Credit Rules, also state that cenvat credit can be utilized for payment of excise duty on final product. - A plain reading of both the Rules clarifies that there is no restriction to the effect that if any assessee avail cenvat credit on procurement of inputs (prior to start of manufacture), is not entitled to take cenvat credit. Infact, without procuring inputs, or some inputs service, assessee cannot start manufacturing activity. Therefore, it cannot be said that an assessee who is a manufacturer of excisable goods is to be denied the cenvat credit of duty paid on inputs or input service availed prior to start of manufacturing activity. When the adjudicating authority held that it is an ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... utilized for payment of duty for the month of March, 2010. Therefore, the appellant is not entitled to take cenvat credit on service tax on cargo handling service which has been distributed to them by their head office prior to start of production. 2. Heard the parties. 3. Learned Counsel for the appellant submits that in this case there is no restriction under Rule 3 of Cenvat Credit Rules, 2004 for availing Cenvat credit prior to start of manufacture and for their utilization. The conditions have been laid down under Rule 7 of Cenvat Credit Rules, 2004 for the ISD distribution of the cenvat credit and Rule 3 provide that an assessee who was the manufacturer or producer of final product is entitled to take cenvat credit on the servi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ly invoked. She also submits that decision relied upon by the learned Counsel are not relevant to the facts of this case. 6. On careful consideration of the submissions made by both the sides, I find that Rule 7 of Cenvat Credit Rules, 2004 deals with the manner of distribution of cenvat credit by ISD which is reproduced as under: RULE [7. Manner of distribution of credit by input service distributor. - The input service distributor may distribute the CENVAT credit in respect of the service tax paid on the input service to its manufacturing units or units providing output service, subject to the following conditions, namely:- (a) the credit distributed against a document referred to in rule 9 does not exceed the amount of servi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... at credit. 9. On limitation also, the adjudicating authority has held that it is an issue of interpretation of Rules and certain decisions are in favour of the appellant, therefore, the adjudicating authority refrain from imposing any penalty under Section 11AC of the Act. Section 11 AC of the Act deals the situation to impose penalty when the assessee has committed any fraud, collusion or made willful mis- statement or suppressed any fact or contravened provisions of Act /Rules to evade payment of duty. Section 11 A of the Act also empowers to invoke extended period of limitation when the provisions of section 11AC of the Act are attracted. When the adjudicating authority held that it is an issue of interpretation of Rule, therefore it ..... X X X X Extracts X X X X X X X X Extracts X X X X
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