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TMI Blog2018 (3) TMI 324X X X X Extracts X X X X X X X X Extracts X X X X ..... respect of bought out goods, Prior to 1.4.2011, there was a confusion whether the trading activity can be treated as exempted service to invoked the provision of Rule 6 of Cenvat Credit Rules on the said trading activity. The trading activity was not taxable service, therefore, there was an interpretation that trading being neither service or exempted service, does not cover under Rule-6 of the Cenvat Credit Rules 2004. It is a settled law that when there is an interpretation of law and had general practice amongst the mass, it cannot be said that the assessee has malafide intention to avail undue benefit. It is also on record that the Appellant have been declaring the availment of cenvat credit on common input service in their ST-3 ret ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ice. During the period prior to 1.4.2011, Rule 6 has no application, accordingly cenvat credit is not required to be reversed. He further submits that the entire demand is beyond normal period of one year. The issue involved was subject to interpretation of Rule 6. It is an admitted fact that to remove the confusion, the legislators have amended the definition of exempted service in Rule 2 (e) of Cenvat Credit Rules, 2004. This clearly shows that the law was not clear whether the cenvat credit is admissible on the input service attributed to the trading activity or otherwise. He further submits that it is an undisputed fact that the Appellant had bonafide belief that cenvat credit is admissible as input service against the manufacture of du ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... treated as exempted service to invoked the provision of Rule 6 of Cenvat Credit Rules on the said trading activity. The trading activity was not taxable service, therefore, there was an interpretation that trading being neither service or exempted service, does not cover under Rule-6 of the Cenvat Credit Rules 2004. Later on, when the legislators felt that the cenvat credit in respect of input service, if attributed to trading activity, the same cannot be allowed, keeping in mind to bring the trading activity under the purview of Rule 6, the definition of exempted service was amended and accordingly the trading activity was brought under the 'exempted service' w.e.f. 1.4.2011. This development clearly shows that there was a serious ..... X X X X Extracts X X X X X X X X Extracts X X X X
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