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TMI Blog2018 (9) TMI 1661X X X X Extracts X X X X X X X X Extracts X X X X ..... Balance 90% will enjoy exemption from payment of service tax. For Financial Leasing Services under section 65 (105)(zm), there is no doubt that service tax is payable even though a part of it is exempted by the above notification. Since service tax is payable, the said service cannot be covered by the definition of “exempted services” - once it is concluded that the Financial Leasing Service is not an exempted service, there is no justification in considering the portion of the value of taxable service exempted vide N/N. 4/2006, dated 01.03.2006 to be included in the formula for determining the amount to be reversed. Appellant has already reversed the Cenvat credit determined in terms of the above formula without including the portio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... exempted services provided F = denotes the total value of exempted services provided plus the total value of taxable services provided G = total Cenvat credit taken on input services during the month E/F gives the percentage of credit to be reversed in a month. Explanation -1 to Rule 6 of the Cenvat Credit Rules, 2004, states value for the purpose of sub-rules (3) and (3A) shall have the same meaning assigned to it under Section 67 of the Finance Act, 1994 read with rules made thereunder, as the case may be, the value determined under Section 4 or 4A of the Central Excise Act, 1944 read with the rules made thereunder. 3. The dispute arose in the calculation of values for E F in the above formula. The following table summari ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t the payment of service tax in terms of the above notification, the department was of the view that the exemption granted vide the above notification is to be added to the total value of exempted services. Accordingly, the value of the exempted portion was added to both numerator and denominator in the above formula resulting in the demand for reversal on credit ordered by the adjudicating authority in the impugned orders, against which the present appeal stand filed. 5. In this context, heard Shri P.C. Anand, Consultant and Shri A. Cletus, ADC (AR) for the Revenue. 6. Learned Consultant submitted that the department has proceeded on the wrong assumption that the exemption granted vide Notification No.4/2006, requires that portion of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rvices by availing the exemption under Notification No.4/2006, dated 01.03.2006. The said notification specified that service tax is required to be paid on a value equal to 10% of the total amount representing interest. Balance 90% will enjoy exemption from payment of service tax. 10. The definition of exempted services prevailing the during the relevant period is reproduced below:- exempted services means taxable services which are exempt from the whole of the service tax leviable thereon, and includes services on which no service tax is leviable under section 66 of the Finance Act. 11. For Financial Leasing Services under section 65 (105)(zm), there is no doubt that service tax is payable even though a part of it is exempted ..... X X X X Extracts X X X X X X X X Extracts X X X X
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