9911796707
TMI Blog2021 (8) TMI 810X X X X Extracts X X X X X X X X Extracts X X X X ..... the appellants are holders of Service Tax Registration for rendering taxable services "Construction of Residential Complex Services", Renting of Immovable Property Services" and "Management, Maintenance or Repair Service". During the course of audit on the records of appellant, it was noticed that the appellant has short paid service tax for the period from April 2017 to June 2017 due to wrong utilization of CENVAT credit, wrongly availed CENVAT Credit of Rs. 13,49,920/- on ineligible input services, short paid service tax of Rs. 1,52,346/- for the period from October 2015 to march 2016 and short paid interest of Rs. 22,183/-. Therefore, a SCN dated 31.01.2019 was issued to the appellant demanding therein service tax of Rs. 13,18,113/- for ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... project on 20.03.2017 - Sai Radha Pride-J (B) Service Tax short paid of Rs. 1,52,346/- (C) Applicability of demand of interest of Rs. 22,183/- 4.1. On the first issue, learned Consultant appearing for the appellant submitted that Sai Radha Pride project was completed on 20.03.2017 and service tax authorities have demanded reversal of CENVAT credit on unsold flats as on the date of completion under Rule 2(l) read with Rule 3(4) of CENVAT Credit Rules 2004. The Department has computed demand of reversal of Rs. 11,38,618/- on total CENVAT credit taken from May 2015 till 30.06.2017 in proportion to unsold area in the project. To counter this demand, learned Consultant submitted that eligibility of CENVAT credit shall be seen at the time o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e notice and demand invoking Rule 2(l) is not sustainable. 4.3. He also submitted that even assuming Rule 6 has to be applied then the computation of reversal should be made in terms of formula prescribed in Rule 6(3A) of CCR (as inserted vide notification no. No.13/2016 w.e.f 01.04.2016). He further submitted that as per the formula the reversal of common input services taken in a financial year in proportion to exempted turnover to total turnover in that financial year. According to the learned Consultant, the amount so computed is worked out to be Rs. 1,79,776. He also submitted that there is no provision in CENVAT Credit Rules which requires computation of reversal amount based on unsold area/ total area. He further submitted that ther ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is not applicable to the demands confirmed under section 11A of the Central Excise Act, 1944. As far as the demand of interest of Rs. 22,183/- on belated payment of Service tax liability, the learned Consultant submitted that as on March 2017, there was unutilized balance of CENVAT credit of Rs. 10,61,644/- as evident from form ST-3 for period October 2016 to March 2017 and interest liability does not arise when there is sufficient balance of CENVAT credit. For this submission, he relied upon the following decisions: * M/s. Oil & Natural Gas Corporation Limited Vs Commissioner of Central Excise & S.T., Surat [Appeal no. ST/11378/2014 * SAVIO INDIA LTD vs COMMR. OF CUS., C.EX. & S.TAX, COIMBATORE 2016 (340) E.L.T. 735 (Tri. - Chennai) ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... that there was no requirement of reversal in terms of Rule 6 up to 01.04.2016 when the Rules got amended. Further, I find that the amended Rules has not been invoked in the SCN and as per the formula prescribed under Rule 6(3A) of the CCR inserted vide Notification No.13/2016 with effect from 01.04.2016, the amounts so computed works out to be Rs. 1,79,776/- as per the appellant. Therefore, on this issue, the matter needs to be remanded back to the Original Authority with a direction to verify the quantum of credit available in the books and reversal made by the appellant to determine the exact demand of tax from the appellant, if any. 6.1. As far as the demand relating to shorty payment of service tax to the tune of Rs. 1,52,343/- is conc ..... X X X X Extracts X X X X X X X X Extracts X X X X
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