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TMI Blog2019 (5) TMI 51X X X X Extracts X X X X X X X X Extracts X X X X ..... r (appeals) which remanded the matter to the adjudicating authority for quantification. The appeal No. E/31195/2018 is by the assessee challenging the demand confirmed as well as the interest and penalties which are proposed to be imposed. 2. Heard both sides and perused the records. The issue, in brief, is the appellant is engaged in the manufacture of chemicals and were issued two show-cause notices the first one dated 25.02.2016 and the second one dated 28.04.2016 for a subsequent period. The appellant manufactures Formaldehyde and Hexamine and steam as final products. The appellant uses the steam in manufacture of their final products and also clears the steam to other units for a price. Steam is exempted from payment of excise duty vi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... emanded the matter to the adjudicating authority which is being disputed by the Revenue. 2) Input services availed for trial production from M/s ICT Mumbai which was used for possible production of soya protein by the appellant. The Revenue's position upheld by the First Appellate Authority with respect to this input service is that with effect from 1.04.2011, the definition of input services has specifically excluded services used in relation to setting up of plant. Therefore the disputed invoices which were issued after this amendment are not eligible for CENVAT credit. The First Appellate Authority further records that the appellant has not produced any evidence that they have manufactured soya protein products out of this soya protein ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ot cleared the steam with respect of either of the disputed periods to any unit other than 100% EOU M/s Lorus Labs Pvt Ltd. He would submit that on this count itself the demand under Rule 6(6) must fail. 5. He also contests the interest and penalty imposed upon them. 6. Learned A.R. submits that as can be seen from the order-in-appeal, appellant assessee has not raised this point before the First Appellate Authority that the entire steam was sold to a 100% EOU only and for this reason the order-in-appeal has confirmed the demand on this count. He agrees that this factual issue needs to be verified since the First show-cause notice does not say that the clearances were to 100% EOU. As far as the dispute regarding the input services provide ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rnization, renovation or repairs of a factory, premises of provider of output service or an office relating to such factory or premises, advertisement or sales promotion, market research, storage upto the place of removal, procurement of inputs, activities relating to business, such as accounting, auditing, financing, recruitment and quality control, coaching and training, computer networking, credit rating, share registry, and security, inward transportation of inputs or capital goods and outward transportation upto the place of removal;" Rule 2(1) of Cenvat Credit Rules with effect from 1-4-2011 is as under: Rule 2(1):"input service" means any service: Used by a provider of output service for providing an 'output service; or U ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... been recorded in the second show-cause notice but not in the first show-cause notice and as has been asserted by the learned Chartered Accountant. If the entire steam was cleared to 100% EOUs, then in terms of Rule 6 (6)(ii) no reversal of CENVAT credit is required. This factual position has to be verified by the adjudicating authority. b) As far as the input services used for trial production of soya protein is concerned, it needs to be verified whether the entire production during the relevant period was cleared on payment of excise duty. Learned A.R. points out that the invoices presented by the learned Chartered Accountant is of 2017 while the services were availed during 2014-15. Therefore, the correlation is required and this verif ..... X X X X Extracts X X X X X X X X Extracts X X X X
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