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TMI Blog2018 (5) TMI 778X X X X Extracts X X X X X X X X Extracts X X X X ..... f reversal of an amount under Rule 6(3)(i) including the value of exempted service i.e. trading will arise only after the date of such amendment. For the period prior to 01.04.2015, there is no requirement of reversal of credit @ 7% of exempted service. This position has been clarified by the CBEC vide their Circular dated 07.12.2015. For the period prior to 01.04.2015 there is no requirement under Rule 6(3)(i) for any reversal of credit of input services availed for clearance of input as such - It has been submitted that on the value of inputs cleared as such, the reversal on the value of goods as required under 3(5) has already been made. This aspect needs to be verified inasmuch as no details have been given on such reversed. In respect ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dispute, the appellant inter-alia, procured steel coils of various widths and sizes as inputs for use in the manufacture of their final product. In some cases, some quantity of the inputs were either cleared as such or after undertaking the process of cutting / slitting. With effect from 14.11.2013, the appellant obtained registration as a dealer and thereafter cleared the inputs, as above, on reversal of the credit under Rule 3(5) of the Cenvat Credit Rules. With effect from 01.04.2011, trading was included as an exempted service and hence inputs cleared as such was done on reversal of proportionate credit of input services attributable to such trading activity as per Rule 6(3) (iii) of the Credit Rules. The Department issued show cause no ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e to trading activity in terms of Rule 6(3A) of the Credit Rules. The adjudicating authority without disputing the reversal of proportionate input service credit, has simply confirmed the demand automatically under Rule 6(3)(i). (ii) Reversal of proportionate credit has been held to be sufficient and the demand for payment @ 5%/ 6% of the value of exempted service under Rule 6(3)(i) is unsustainable as has been held in the following cases: Dalmia Bharat Sugar and Industries Ltd. vs. CCE,C&ST, New Delhi-2017-TIOL-113-CESTAT-DEL. Tata Technologies Ltd. vs. CCE, Pune-I- 2016 (42) STR 290 (Tri. Mumbai). (iii) The adjudicating authority has held that the inputs procured and subsequently cleared as such or are after undertaking process of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d hence it incurs the mischief of reversal @ 5% under Rule 6(3)(i). He argued that trading has been specified as an exempt service w.e.f. 01.03.2011. 6. Heard both sides and perused the record. 7. The dispute in the present case is relating to inputs such as steel coils procured by the appellant, and cenvat credit availed thereon under the Cenvat Credit Rules, 2004. Part of the inputs were cleared as such and sometimes after slitting. At the time of such clearance, the appellant claims to have reversed the cenvat credit availed on such inputs as required under Rule 3(5). The revenue has taken the view that the activity as above amounts to trading, which has been specified as exempted service w.e.f. 01.04.2011. Hence, Revenue has demanded ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ce i.e. trading will arise only after the date of such amendment. For the period prior to 01.04.2015, there is no requirement of reversal of credit @ 7% of exempted service. This position has been clarified by the CBEC vide their Circular dated 07.12.2015. Hence, we are of the view that for the period prior to 01.04.2015 there is no requirement under Rule 6(3)(i) for any reversal of credit of input services availed for clearance of input as such. It has been submitted that on the value of inputs cleared as such, the reversal on the value of goods as required under 3(5) has already been made. However, this aspect needs to be verified inasmuch as no details have been given on such reversed. In respect of reversal of credit of input services, ..... X X X X Extracts X X X X X X X X Extracts X X X X
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