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TMI Blog2020 (11) TMI 34X X X X Extracts X X X X X X X X Extracts X X X X ..... ces furnished by the appellant did not add up to the amount of credit claimed to have been availed in September, 2009. This, according to the Appellant, was an absolutely presumptive and inconsequential finding since the Department had disputed the credit only for the reason that there was a difference between the opening stock and the closing stock. The order passed by the Commissioner does not take into consideration the explanation offered by the Appellant and only some invoices were examined by the Commissioner - matter remitted to the Commissioner to determine this particular issue afresh in the light of the charge leveled in the show cause notice and the explanation offered by the Appellant. Whether credit is admissible tippers as inputs under rule 2(k) of the Credit Rules? - HELD THAT:- In SOUMYA MINING LTD. VERSUS CCE, RAIPUR [ 2017 (6) TMI 1071 - CESTAT NEW DELHI] , the Tribunal held that even for the period prior to June, 2010 credit was admissible on tippers as inputs used by the service provider in providing output services. This view was followed by the Tribunal in CCE, CCG ST, DELHI III VERSUS M/S BHARMAPUTRA INFRASTRUCTURE LTD. [ 2018 (7) TMI 438 - C ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of interest on suo-moto reversal of credit by the Appellant. 4. The Appellant is engaged in providing site formation and clearance, excavation, earth moving and demolition services as also mining services. It claims that it availed CENVAT credit on inputs, capital goods and input services under the provisions of the CENVAT Credit Rules 2004, the Credit Rules. The records indicate that a contract was executed between the Appellant and M/s Singareni Collieries Company Limited, SCCL for blasting, hole drilling, controlled blasting with shock tube initiation, excavation, loading and transportation and dumping. According to the Appellant, the contract stipulated that the explosives, accessories, diesel required for the job of drilling, blasting, transportation were required to be supplied free of cost to the Appellant by SCCL. 5. During the course of scrutiny of the records of the Appellant, the Department raised the following objections for the financial years 2008-2009 and 2009-2010. (i) The Appellant had not paid service tax on the value of diesel, explosives, accessories etc., supplied free of cost by SCCL to the Appellant. The Department believed that in terms of rule 5(1) ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e tax amounting to ₹ 14,07,98,655/- on the value of diesel, explosives etc, received by the Appellant free of cost, under section 68 of the Finance Act, 1994, the Finance Act. Further, credit of ₹ 30,05,484/- was proposed to be disallowed by alleging excess availment of CENVAT credit. A demand of CENVAT credit amounting to ₹ 64,91,195/- was also proposed on the ground that since credit on tippers was made admissible w.e.f. June 22, 2010, credit availed by the Appellant on tippers received prior to such date was inadmissible. The show cause notice also proposed to demand interest of ₹ 6,53,650/- on the suo-moto reversal of credit. 8. The Appellant submitted a detailed reply to the show cause notice stating therein that none of the demands proposed in the show cause notice were sustainable and, therefore, they should be dropped. 9. The Commissioner, by order dated August 1, 2014, however confirmed the demand for following reasons: (i) The materials (diesel/explosives etc.) received free of cost by the Appellant were nothing but consideration from the service provider, and therefore, the value of such materials have to be included in the taxable va ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ur, 2013 (32) STR 740 (Tri.- Del.), wherein it was held that the value of free of cost diesel supplied by the service recipient shall not be includible in the taxable value of services. However, the Commissioner distinguished the aforesaid decision on the ground that the Department had filed an appeal against the decision of the Tribunal. This finding of the Commissioner is unsustainable on two accounts. Firstly, the appeal preferred by the Department (C.A. 2452-2455/2014) had been disposed of by the Supreme Court by Judgment dated February 19, 2018, while deciding Bhayana Builders; and secondly, it is an established law, that a binding precedent cannot be distinguished merely on the ground that the Department had preferred an appeal against such a decision before an appellate forum; (iv) Disallowance of CENVAT credit amounting to ₹ 30,05,484/-, on account of alleged excess availment of credit is factually incorrect and unsustainable. The difference of ₹ 30,05,484/- had arisen due to an inadvertent clerical error in the filing of the returns. The Appellant had inadvertently recorded the closing balance of September, 2009 as ₹ 64,97,643/-, instead of recording ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ves supplied free of cost in the value of taxable services provided by the Appellant. 15. In this connection, it would be pertinent to refer to the order dated September 26, 2008 issued by SCCL (the company) in favour of the Appellant (the contractor). The relevant clauses of the work order are reproduced below:- With reference to the above, it is to inform that your offer has been accepted and the subject work is awarded to you for execution, as per the scope, terms and conditions, details, etc, furnished hereunder. Note : In this order the word CONTRACTOR means R.K. Transport Co. and the word COMPANY means The Singareni Collieries Company Limited 1. Scope of Work Blast hole drilling, controlled blasting with shock tube initiation, excavation, loading, transportation and dumping etc. of over burden. Explosives accessories and diesel would be supplied by SCCL. b) Blasting i) The contractor shall carryout controlled blasting with shock tube initiation by the explosives and accessories supplied by SCCL. Wherever the term explosive is used in the document, it includes explosives and accessories ii) SCCL shall supply SMS system explosive ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . The only ground mentioned by the Commissioner for not following this decision is that the Department had filed an Appeal against the decision of the Tribunal. It was not open to the Commissioner to refrain from following this decision merely because the Department had preferred an Appeal against such decision. 21. The second issue that arises for consideration is regarding the disallowance of CENVAT credit amounting to ₹ 30,05,484/- on account of excess availment of credit. The Commissioner has disallowed this amount of CENVAT credit for the reason that there was a difference between the closing balance of the CENVAT credit in the return filed by the Appellant in September, 2009 and the opening balance in October 2009. According to the Appellant, the difference had arisen on account of an inadvertent clerical error in the filing of the returns, wherein the Appellant had recorded the closing balance of September, 2009 as ₹ 64,97,643/- instead of ₹ 95,03,124/-. It has been pointed out by the Appellant that such clerical mistake was rectified in the return filed for the next quarter i.e. October, 2009 to March, 2010, wherein the opening balance was shown as S ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... aised that the opening balance shown by the Appellant for April, 2009 was ₹ 1,88,00,727/- lesser than the closing balance of March, 2009, which meant suo moto reversal of credit for which the Appellant was liable to pay interest, the Appellant computed the interest liability from the date of availment of such credit to the date of reversal and, accordingly paid ₹ 2,46,561/-. 28. Thus, when credit was reversed by the Appellant without utilization, no interest can be recovered from the Appellant. This view has been consistently taken by the Tribunal and reference can be made to the following decisions: (i) Commissioner of Central Excise Service Tax LTU, Bangalore v/s Bill Forge Pvt. Ltd. 2012 (279) ELT 209 (Kar.); (ii) Jaypee Greens v/s Commissioner Customs, Central Excise Service Tax, Noida, 2019 (11) TMI 437-CESTAT Allahabad; (iii) M/s H.E.G. Limited v/s Commissioner of Central Excise, Bhopal 2017 (5) TMI 1247-CESTAT New Delhi; (iv) Siddapur Distilleries Ltd. v/s Commissioner of Central Excise, Customs Service Tax, Belgaum, 2019- TIOL-2520-CESTAT-BANG; and (v) JK Tyre Industries Ltd. v/s Commissioner of Central Excise Service Tax ..... X X X X Extracts X X X X X X X X Extracts X X X X
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