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TMI Blog2018 (5) TMI 1189X X X X Extracts X X X X X X X X Extracts X X X X ..... iod up to 01/04/2011 - further, for the purpose of denying the CENVAT credit, the Revenue has considered the entire value of the turnover and has demanded an amount of ₹ 15,13,218/equal to 8% / 6% / 5% of the value of exempted services as applicable for the relevant period. The Revenue cannot demand CENVAT credit on entire turnover of trading and has to follow the procedure for determining the value of the trading goods for the purpose of Rule 6 of CCR. There is no infirmity in the impugned order which is upheld subject to the quantification of CENVAT credit to be disallowed on the basis of the formula prescribed under Rule 6(3), after that, interest and penalty should be accordingly quantified - Appeal allowed in part. - E/21722/ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ngly availed. The adjudicating authority, after following due process of law, in 010 disallowed the irregular credit availed and demanded from the appellants the irregular credit availed during the period April-2007 to January-2012 amounting to ₹ 15,13,218/- equal to 8%/6%/5% of the value of the exempted services as applicable for the relevant period in terms of Rule 6(3)(i), along with interest under the provisions of Rule 14 of the Cenvat Credit Rules, 2004 (CCR in short) read with Section 11 A and 11 AB of the Central Excise Act, 1944 (Act for short) and also imposed penalty in terms of Rule 15(2) of the CCR 2004, Read with Section 11 A of Act, 1944 for contravention of Cenvat Credit Rules 2004. Aggrieved by the said order, appella ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ng activity. 6. He further submitted that there is no suppression on the part of the appellant and the Department has wrongly invoked the larger period o limitation in issuing the show-cause notice. He also submitted that the input service in question was fully used for manufacturing activity and no portion of the said service is used for trading. It is his submission that the Department in terms of explanation to Rule 6(3d)(c)of CCR instead of adopting the difference between purchase and sale of the traded goods or 10% of the cost of the goods sold, whichever is higher as a trading goods value for the purpose of Rule 6 of CCR, has taken the entire turnover. He also submitted that just because the appellant has not followed the procedu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... se of FL Smidth Ltd. cited supra has held in para 11 regarding the plea of limitation. He also relied upon the decision of the Division Bench of this Tribunal in the case of HCL Infosystems Ltd. Vs. CC CE, Noida [2014-TIOL-3183-CESTAT-DEL] wherein also the Tribunal has held that invocation of extended period is perfectly justified and the trading cannot be considered as a service or an exempted service. Learned AR also submitted that this Tribunal in the case of Micro Labs Ltd. [Final Order No.21265-21285/2016 dt. 23/11/2016 has also taken the view that if the input service credit was used in relation to trading activity, then it amounts to suppression of fact and therefore extended period of limitation is correctly invoked as the appellant ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t merit acceptance, Till the fiction was introduced that trading is an exempted service, by the Explanation introduced w.e.f 01 04.2011 in the Cenvat Credit Rules, 2004, trading which is a sale of goods could not have been considered as a service, a taxable service or an exempted service. The input services (on which cenvat credit was earned by the assessee) were consumed for its trading activities and could not have been availed or taken for discharging service tax on the services provided by the assessee, after the trading activity. There is no scope for any interpretational misconception on this aspect. Invocation of the extended period is therefore without error. The Tribunal in Orion Appliances Ltd. Vs. CST, Ahmedabad [2011] 46 VST 19 ..... X X X X Extracts X X X X X X X X Extracts X X X X
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