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TMI Blog2018 (11) TMI 1443X X X X Extracts X X X X X X X X Extracts X X X X ..... ed in the manufacture of writing and printing paper classifiable under Chapter 48 of the 1st Schedule to the Central Excise Tariff Act, 1985, in its unit Sewa located at Jeypore in the district of Koraput, Odisha. The appellant is also having other manufacturing units located in the State of Maharashtra and Haryana. The appellant availed Cenvat Credit of the Central Excise duty and countervailing duty paid on input materials such as, pulp, sodium chloride, chlorine, starch and lime. The appellant also availed input service credit on GTA service and port service used for procurement and inward transportation of above input materials, in terms of Rule 2 (l) of Cenvat Credit Rules, 2004. Subsequently, certain quantities of above input material ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... towards procurement and transportation of input materials from the port to the factory of the appellant. It is his submission that the extended period of limitation is not at all applicable to the facts of the present case and accordingly, imposition of penalty under Section 11AC of the Central Excise Act, 1944, read with Rule 15 (2) of Cenvat Credit Rules, 2004 is unwarranted since the issue relates to interpretation of statutory provisions. 4. The ld.D.R. appearing for the Revenue reiterates the order of the lower authorities. 5. Heard both sides and perused the appeal records. 6. I find that the assessee had cleared 2245.640 MT of inputs, viz., Pulp, Lime & Sodium Chlorate etc. as such, to its sister unit. For procuring these quantiti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... input services like Customs Brokers charges, Clearing and Forwarding Agencies Services (C&F), GTA etc. used for procurement/transportation of inputs/capital goods, should also be reversed at the time of clearance of inputs/capital goods as such from the factory of the manufacturer. The present Rule 3 (5) of the Cenvat Credit Rules, 2004 does not mention 'Input Services' amongst the credits required to be reversed and therefore it is not possible to demand reversal of credit of input services. There is need to amend the rules so that reversal of credit taken on input services can also be achieved. Discussion & Decision The conference noted that Rule 3(5) of the CENVAT Credit Rules, 2004 does not provide for reversal in respect of input ser ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... manufacture of their final product, namely, sponge iron. In bringing the said iron ores, which were used as input, the appellants had paid service tax on GTA services. Consequently, they had availed Cenvat credit on the amount of service tax paid on GTA service as the same satisfies the definition of input service prescribed under Section 2(l) of Cenvat Credit Rules, 2004. During the course of manufacture of sponge iron, the said iron ore was subjected to the process of screening and after completion of the said process, iron ore fines were generated. It is the case of the Revenue that these iron ore fines were not used in the manufacture of their final product, namely, sponge iron, but were sold in the market. Therefore, since the iron or ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n 66 of the Finance Act, 1994. Rule 3(5) of the Rules only talks about the Cenvat credit taken on inputs or capital goods. It does not refer to the Cenvat on input service, whereas Rule 5, on which reliance is sought to be placed by the Revenue, specifically talks about the Cenvat credit on any input or input service used in the manufacture of final product. This rule pertains to refund in case of exports, which stands altogether on different footings. Once the rule-making authority has defined the terms specifically and used the same in different provisions consciously, the argument of learned counsel for the Revenue that merely by analogy even if in one provision both the terms have been used, the same should be read in the other provisio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nyway used to pay duty on the finished goods. In the circumstances, I find that the impugned order sustaining the demand of service tax and education cess to be not sustainable and accordingly, vacate the same." The said principle has been followed in M/s. Sponge Udyog Pvt. Ltd.'s case (cited supra). In the light of the above consistent view, I do not find merit in the order of the ld. Commissioner (Appeals). Consequently, the same is set aside and the appeal filed by the appellant is allowed with consequential relief, if any, as per law. 8. In view of the above discussions, the impugned order is set aside the appeal filed by the appellant is allowed with consequential relief to the appellant, if any. (Operative part of the order was pro ..... X X X X Extracts X X X X X X X X Extracts X X X X
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