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TMI Blog2019 (7) TMI 1680X X X X Extracts X X X X X X X X Extracts X X X X ..... ise Tariff Act, 1985. The appellant is also registered with the Service Tax Department for Transport of Goods by Road Services ("GTA"). It appeared to the Department that the appellant has short paid/not paid Central Excise duty amounting to Rs. 60984/- on Rajasthan Investment Promotion Scheme, 2010 (hereinafter referred to as Scheme) against VAT, Sales Tax instead of actual payment of VAT to the State Government, which constituted the part of transaction value and additional consideration in contravention of Section 4(3)(d) of the Central Excise Act, 1944 (hereinafter referred to as the Act) read with the provisions of Rules 4, 6, 8 and 11 of Central Excise Rules, 2002 as amended during the period January 2016 to December, 2016. The other issue was regarding denial of abatement of Notification No. 26/2012-ST, dated 26.2.2012 which was availed by the appellant and the service tax was paid by availing the exemption of abatement to the extent of 75% or 80% of the value of taxable services on the ground that the appellant failed to adduce any documentary evidence as mandated by the Central Board of Excise and Customs 37B order dated 12.3.2007. The CBEC circular as prescribed a procedu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dings contained in the impugned order in support of the Revenue's contention. 6. We have considered the rival submissions and also perused the case record. 7. The first issue regarding the inclusion of VAT subsidy as claimed by the Revenue is not sustainable in view of various judgements cited by the learned Advocate. This Tribunal has also occasioned to examine the issue afresh in case of M/s H-One India Private Limited Vs. CCE, Rajasthan wherein after considering the various decisions of this Tribunal, it has been held that the VAT subsidy obtained in form 37B under RISP scheme is not includible in the computation of transaction value under Section 4D of the Act. The relevant paragraph of the said order is reproduced as under : "4. The learned Authorised Representative of the Department has, however, supported the impugned order and contended that it does not call for any interference. 5. It is in the year 2010 that the Government of India notified a Scheme called "Rajasthan Investment Promotion Scheme - 2010". The Scheme seeks to promote investment in the State of Rajasthan and to further generate employment opportunities through such investment. It came into effect from 2 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t of tax (es) which have become due and have been deposited by the enterprise. E. The maximum limit of Employment Generation Subsidy shall be as mentioned in column number 5 of Table 3, and shall be allowed to the eligible enterprise at the rate as mentioned in column number 4, according to the category of enterprise and employee as mentioned in column number 2 and 3 respectively of Table-3 given below." 7. Clause 5 deals with 'Exemptions' and provides as follows : "A. The Enterprise to which an Entitlement Certificate as prescribed under the Scheme has been issued shall be eligible to claim the exemption(s) from the taxes/duties/charges, to the extent and for the period as mentioned in Table-4 given below xxxxxxxxx xxxxxxxxx xxxxxxxx B. In case of Enterprises going for Modernization/ Expansion/ Diversification, the exemption from payment of tax (es) shall be allowed only to the extent to which additional tax liabilities accrue due to utilization of additional capacity created after Modernization/Expansion/Diversification." 8. The procedure for claim has been set out in Clause 6 of the Scheme, while 'Procedure for Disbursement of Subsidy' has been provided in Clause 7. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... % was to be retained by the assessee, whereas under the 2004 Scheme, the entire amount collected by the assessee was required to be deposited with the State authorities. 10. It would be pertinent to refer to the relevant portion of the decision of the Tribunal in Shree Cement Ltd. and it is as follows :- "7. We have heard both sides at length and perused the appeal record. As out lined above, the appellants are covered by the Investment Promotion Schemes of the Rajasthan Government. In terms of the various schemes of the Rajasthan Government, the appellants are required to discharge their VAT liability by making payment of the same. Out of such VAT credited to the Government, a certain portion is disbursed back to them in the form of subsidies. Such disbursement happens in the form of VAT 37 B, challan which can be utilized in subsequent periods to discharge VAT liability. The crux of the dispute in the present case is whether such subsidy amounts are required to be included in the assessable value of the goods manufactured by the appellants, in terms of Section 4 of the Central Excise Act. As per the concept of transaction value outlined in Section 4, with effect from 01/07/20 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... m exemption from payment of sales tax. The quantum of remission was based upon the investment made in the fixed assets. The condition of the remission amongst others included to remain in production, employment of certain percentage of persons in assessee unit, and numerous other conditions as brought out in Para 9 of the impugned Order-in-Appeal." 11. By following the decision of the Tribunal in the Welspun Corporation Ltd. case we conclude that there is no justification for inclusion in the assessable value, the VAT amounts paid by the assessee using VAT 37B Challans". 11. The Tribunal in M/s Maihar Cement followed the aforesaid decision rendered in M/s Shree Cement Ltd. as basically both the Scheme of the Rajasthan Government and Madhya Pradesh Government were identical. 12. In the present case, as noticed above, the Appellants in terms of the Scheme had deposited the entire amount of VAT collected. It is this amount that is used as a measure for granting financial assistance to be subsequently provided. 13. The judgment of the Tribunal in M/s Maihar Cement and M/s Shree Cement Ltd. would, therefore, apply and the financial assistance granted to the Appellants cannot be ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n 2011 (22) STR 624 (Tri.-Bang.) has observed that GTA service provider is not required to furnish evidence of non-availment of Cenvat scheme to qualify the benefit of Notification No. 32/2004-ST in as much as there is no such conditions in the notification for making declalration on each consignment note. To the same effect is another decision of the Tribunal in the case of Andhra Pradesh Paper Mills Ltd. Vs. CCE, Visakhapatnam reported in 2010 (19) STR 557 (Tri.-Bang) and Krebs Biochemicals & Indus. Ltd. Vs. CCe, Visakhapatnam reported in 2011 (22) STR 631 (Tri.-Bang.). We also note that some of the decisions given by the Tribunal stand approved by the Hon'ble High Courts." A per Rule 3 of the Cenvat Credit Rules, 2004, the credit can be availed by the manufacture or the purchaser of final product or output service only. Rule 2(P) of the said rule defined ' output service (with effect from 1.7.2012)as under : "Because in terms of Rule 3 of Cenvat Credit rules, 2004, credit can be availed by a manufacturer or producer of final product or a provider of output service only. Rule 2(P) of the said rules, defined "output service" (with effect from 1.7.2012) as under: 2(p) - "Outpu ..... X X X X Extracts X X X X X X X X Extracts X X X X
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