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TMI Blog2024 (2) TMI 819X X X X Extracts X X X X X X X X Extracts X X X X ..... AT:- The incentives offered for achieving targets of sale cannot be said to be incentives for promoting the sale of M/s. Volkswagen as the appellant is interested to do more sales for their own benefit of making more profit. It cannot be said that they promote the sales of M/s. Volkswagen or M/s. Castrol India Ltd. The incentives depend on the targets achieved which the appellant is interested to achieve as they would earn more profit. Even if there was no such incentive the appellant would be attentive and focused to sell cars to their maximum possible. The incentive is not in the nature of any consideration for providing services to M/s. Volkswagen and M/s. Castrol India Ltd. The Tribunal in the case of M/s. S.K. Cars India (P) Ltd. Vs. Commission of GST and CE, Sale, [ 2023 (6) TMI 243 - CESTAT CHENNAI] had occasion to consider a similar issue. It was held that the incentive / discount are in regard to sales transaction and cannot be subject to service tax. For the period after 01/07/2012, the demand has been made under the definition of service under Section 65 (44) B. It is already concluded that there is no element of service. The incentives are purely on the basis of sales a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... - CESTAT MUMBAI] - the demand raised alleging that appellant has to pay 5% / 6% / 7% of the value of exempted services even though they have reversed proportionate credit cannot sustain. This issue is found in favour of appellant and against the department. Whether the appellant is liable to pay service tax for the period prior to 12/2015? - HELD THAT:- The appellant company has come into existence only in 2015 and therefore cannot be called upon to pay service tax prior to 2015. As the issue is already found on merits for the demands for the period prior to 2015 and after 2015 to be not sustainable, any further discussion on this issue would be of no consequence - it is thus not necessary to delve into this issue which is of technical nature. The confirmation of demand of service tax, interest and penalties cannot be sustained. In the result, the impugned order is set aside - Appeal allowed. X X X X Extracts X X X X X X X X Extracts X X X X ..... obtained a common registration covering two service centres and two show rooms at Bangalore, one service centre and one show room at Mangalore. Shri Shamit Bhatia and Shri Umesh Sharma are the Directors of the Company and Shri K. Subramanian is the CEO of the Company. M/s. Jubilant Motor Works Pvt. Ltd. started operations in Chennai in the year 2009. During December 2015 a separate Company namely M/s. Jubilant Motor Works (South) Pvt. Ltd. (appellant) was established with Shri K. Subramanian as CEO and Director of the Company. After formation of M/s. Jubilant Motor Works (South) Pvt. Ltd., they have obtained a fresh Service Tax registration in respect of the premises at Chennai. Further, Shri Manish P. stated that after initiation of investigations by DGCEI, he is in the process of quantifying their correct service tax liability and also working out the differential service tax liability in respect of Chennai operations of both the Companies, and to discharge the tax at the earliest. The lapse has occurred due to shortage of manpower and further a team looking after the taxation matter is stationed at Noida and due to non-availability of Senior Manager at Chennai, there was a commu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he service tax. 1.8. The appellant had availed input service tax credit on certain common input services which were used for providing both taxable and trading (exempted services). The appellant did not follow the procedure prescribed under Rule 6 (3) of CENVAT credit Rules 2004 by maintaining separate accounts. However, after initiation of investigation, they quantified the ineligible CENVAT credit availed and utilised by them in respect of trading (exempted services) and the service tax liability and paid up Rs.41,09,425/- (including interest of Rs.15,11,944). 1.9. It therefore appeared that the services provided by the appellant are rightly classifiable as: i. Authorised Service Station Services for the services of providing repair and service of "AUDI" brand cars for the period up to 30.06.2012. ii. Business auxiliary services in respect the income received under the heads - Finance Income, insurance income, insurance income renewal, service charges towing, commission - AUDI car sale, courtesy car income, service charges received (registration), commission on trading, services charges received - AUDI sure, service charges received - service plan, service charges -pick up ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Rs.15,69,838/- paid by the noticee against demand at (v) above. (vii) I demand interest on the amount mentioned at (v) above under Rule 14 (1) (ii) read with Section 75 of the Finance Act, 1994. (viii) I appropriate an amount of Rs. 10,71,903/- paid by the noticee in cash against interest demanded in (vii) above. (ix) I impose a Penalty of Rs. 10,71,78,845/ under Section 78 of Finance act 1994. However, in terms of proviso to Section 78, this penalty shall be reduced to 25% of the total penalty if the entire demand, interest and such reduced penalty is paid within 30 days from the receipt of this Order. (x) Since penalty under Section 78 is already imposed, I refrain from imposing penalty under Section 76 of the Finance Act, 1994. (xi) I impose a penalty of Rs. 10,000/- (Rupees Ten thousand only) under Section 77 of Finance Act, 1994. (xii) I impose a Penalty of Rs. 6,58,91,965/- under Rule 15(3) of the CENVAT Credit Rules, 2004 read with Sections 78 of Finance act 1994. However, in terms of proviso to Section 78, this penalty shall be reduced to 25% of the total penalty if the entire demand, interest and such reduced penalty is paid within 30 days from the receipt of t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d launched certain incentive schemes wherein various pre-agreed incentives were provided to the Appellant in respect of Audi brand of cars/parts sold by Volkswagen to the Appellant. The discounts passed on relate only to the activity of sale of cars by Volkswagen to the Appellant. vii. Similarly, the Appellant also received target-based incentives from Castrol for purchase of engine lubricants by the Appellant. viii. For the period up to 01.07.2012, the Impugned Order has given a finding that the Appellant carries out the activities only on behalf of Volkswagen and that these definitely promote the products of Volkswagen. Hence, these activities undertaken for incentives are covered by the definition of 'Business Auxiliary Services' under Section 65(19) read with Section 65 (105) (zzb) of the Act. However, SCN did not specify the category/sub-clause under which the service in question will be covered under Section 65(19) of the Act. ix. For the period post 01.07.2012, no finding is given in the Impugned Order. x. In respect of incentives received from castrol, the demand is confirmed in the Impugned Order on the portion of 'product discounts' received from Castrol by statin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 916/- Non-payment of service tax on incentives received from Castrol 18,676/- 2. Non-payment of service tax on car advance forfeiture from customers 12,34,253/- 3. Non-reversal of CENVAT credit under Rule 6(3)(i) of the CENVAT Credit Rules 6,58,91,965/- xx. The Ld. Counsel for appellant explained as under : A. The Appellant Company was incorporated in December 2015. There cannot be any liability on the Appellant for the entire demand prior to December 2015. (i.e., April 2011 to 20th December 2015) A.1 It is submitted that Section 68 of Finance Act, 1994 (hereinafter referred to as 'the Act') casts the duty of payment of service tax on the person who provides a taxable service. However, up to the period 20th December 2015, the Appellant Company had not entered into any business transaction with JMWPL, and it was incorporated only on 03.11.2015. In such a situation, the question of the Appellant Company providing any taxable service does not arise. Therefore, as the Appellant Company did not provide any taxable service till 21st December 2015, appellant is not liable to pay service tax. A.2 Consequently, the Department cannot demand service tax from the Appellan ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s done. Such claim can be made only when the final adjudication has been done after quantifying the amount due and payable by the assessee (transferor). A.6 It is submitted that, in such scenario when no tax is recoverable or due on JMWPL (transferor), even Proviso to Section 87(c) of the Act is not applicable to the facts of this case. A.7 It is submitted that there is no provision in the Act under which proceedings could have been initiated and continued and the Appellant could have been assessed and taxed for the period prior to 20th December 2015. In this regard reliance is placed on the decision of the Delhi High Court in Freezair India (P) Limited v. Commissioner of Central Excise, Commissionerate 2014 (304) ELT 360 (Del), wherein in Para 21 of the said decision, it has been held that Proviso to Section 11 of the Central Excise Act, 1944 [pari materia to Proviso to Section 87(c) of the Act] and Rule of the Central Excise Rules, 1944, relate to recovery and is a method of recovery of the dues assessed and payable by the predecessor. Further observed that taxation statutes, normally treated and regarded as self-contained codes, expressly or by clear implication should stipu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... es not mention the specific clause under which the alleged services are taxable and hence demand cannot be legally sustained. B.1 The Appellant submits that Show Cause Notice should clearly indicate the sub-clause of Section 65(19) under which the alleged business auxiliary services are rendered. If the demand is made merely stating that the services rendered falls under Business Auxiliary Services without mentioning the specific clause, the demands cannot be legally sustained. B.2 In this regard reliance is placed on the decision of the CESTAT in Syniverse Mobile Solutions Pvt Ltd., (Earlier Transcibernet India Pvt Ltd.) Versus Commissioner Of Customs, Central Excise & Service Tax, Hyderabad - IV 2023 (6) TMI 463 - CESTAT HYDERABAD, where without going into further merits the Tribunal set aside the demand on the sole ground that the Department has failed to issue the Show Cause Notice with specific allegation specifying the sub-clause of Section 65(19). Similar view has been held in the following decisions, • Commissioner Of Customs And Central Excise, Goa Versus Shri. Swapnil Asnodkar 2018 (1) TMI 266 - CESTAT MUMBAI • United Telecoms Ltd. Versus Commissioner Of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... vt Ltd v Commissioner of Central Excise and Customs & CGST, Jaipur,2022(8) TMI 1254- CESTAT New Delhi iii. M/s. Rohan Motors Limited Vs Commissioner of central exercise 2020 (12) TMI 1094- CESTAT New Delhi iv. M/s PREM MOTORS PRIVATE LIMITED Vs COMMISSIONER, CENTRAL EXCISE & CGST-JAIPUR 2023-VIL-208-CESTAT-DEL- ST C.4 Similarly, the Appellant had purchased goods from Castrol to be used in their workshop. Castrol offers product discounts and target incentives based on the purchases made by the Appellant as per the agreement between the Appellant and Castrol. The submission of the incentives received from Volkswagen is applicable for the incentives received from Castrol as well. Hence, for the sake of brevity, it may be treated as part and parcel of this submission as well. Issue 2 : Non-payment of service tax on car advance forfeiture from customers. (Amount Involved Rs. 12,34,253/-) D. The Department has failed to mention and classify the services it seeks to propose and demand Service Tax in the SCN. On this ground itself, the entire demand proposed in the SCN merits to be set aside. D.1. The Appellant submits that the SCN issued by the Department has not classified an ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... but in the nature of penalty/liquidated damages levied by the Appellant on the customers for cancellation of bookings of vehicles. This income is not in the nature of consideration towards any service. It is submitted that penal charges of any nature are not consideration for provision of any service because penalty itself is charged when no service is provided or no sale is undertaken. F.2 It is submitted that when the purpose to levy 'forfeiture charges' is to penalize the customers or make good the loss suffered by the Appellant on cancellation of booking, the same cannot be said to be towards any activity. F.3 The Appellant submits that collection of forfeiture charges is a condition to the contract and not consideration to contract. F.4 Hence, the demand of service tax on 'forfeiture income' alleging the same to be consideration against provision of 'BAS' for the period up to 30.06.2012 is liable to be set aside on this ground alone. In this regard, the Appellant places reliance on Circular No. 121/2/2010-ST, dated 26.04.2010, Circular No. 96/7/2007-ST, dated 23.08.2007, Circular issued under F. No. 137/25/2011-ST, dated 03.08.2011, wherein it has been uniformly held tha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... termining whether service tax on an activity or transaction needs to be levied treating it as service by way of agreeing to the obligation to refrain from an act, or to tolerate an act or a situation, or to do an act. F. 9. Hence, placing reliance on the above decisions and the Circulars, the Appellant submits that, Appellant is not liable to discharge service tax on the forfeiture income as it does not qualify as consideration for any service provided by the Appellant. Issue 3: Non-reversal of CENVAT credit under Rule 6(3)(i) of the CENVAT Credit Rules. (Amount Involved Rs. 6,58,91,965/-) G. The Intimation Under Rule 6(3) of the Credit Rules is merely procedural and the Appellant is free to choose any one of the three options provided under Rule 6 of the CCR. G.1 The Appellant has reversed the proportionate credit of Rs. 15,69,836/- with interest of Rs. 10,71,903/- in terms of Rule 6(3) of the CCR. The SCN in Para 4.6 has duly acknowledged the same. G.2 The Impugned order has alleged that the Appellant has not maintained separate accounts for the receipt and use of input services used commonly for providing taxable and exempted service as mandated under Rule 6 of the Cre ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... icals Pvt. Ltd. 2007 (216) ELT 3- Supreme Court. d) Padmini Products Ltd. v. CCE, 1989 (43) ELT 195-Supreme Court. I.1 It is submitted that in the view of the foregoing submissions, since the demand of Service Tax is unsustainable, the question of imposing interest under Section 75 of the Act and penalty under Section 77 and 78 of the Act does not arise. I.2 It is further submitted that, in any case, the Appellant has not taken or utilized the credit wrongly by reason of fraud, collusion or any wilful misstatement or suppression of facts, or contravention of any of the provisions of CCR and the Act and therefore no interest is payable under Rule 15 of the CENVAT Rules. In light of the above submissions, it is humbly prayed that the appeal be allowed in full, and the Impugned Order confirming the demand of Service tax interest and penalties be set aside with consequential relief. 3.1. The Ld. AR Shri Rudra Pratap Singh appeared and argued for the department. In regard to the first contention of appellant that, appellant company has been established only with effect from 21/12/2015 and therefore not liable to pay service tax prior to this period, the Ld. AR adverted to the s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tory of Responsibility. The Dealer shall promote the Contractual Products, after sales service thereof and such other services which are designated by the supplier and provided by the supplier and the sale organization. …….. (4) To safeguard and promote the sales of the Contractual Products, the Dealers shall conduct its Audi approved plus business effectively and in line with the suppliers' guidelines and shall offer financial services in line with the suppliers' recommendations". 3.5. It is argued by the Ld. AR that the incentives are given to the appellant for promoting the business / sales of M/s. Volkswagen and therefore these incentives are nothing but consideration received for providing Business Auxiliary Services. So also in the case of incentives received by appellant from M/s. Castrol India are for providing sales promotion of castrol products. The confirmation of demand of service tax under Business Auxiliary Services is correct and proper. 3.6. The appellant also earned income as 'car advance money forfeited'. When a customer books a car, certain amount is collected from him as advance, towards booking. Subsequently, if the customer cancels the book ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the period from April 2011 to March 2016. It falls before the period 1/7/2012 and after. Though the Show Cause Notice alleges that these are services of promotion and marketing falling under BAS, the Show Cause Notice does not specify under which subclause of section 65 (19), the alleged service would fall. For better appreciation, the definition of BAS under Section 65 (19) is reproduced as under: [(19) "business auxiliary service" means any service in relation to - i. promotion or marketing or sale of goods produced or provided by or belonging to the client; or ii. promotion or marketing of service provided by the client; or 20 [***] iii. any customer care service provided on behalf of the client; or iv. procurement of goods or services, which are inputs for the client; or 21 [Explanation-For the removal of doubts, it is hereby declared that for the purposes of this sub-clause, 'inputs" means all goods or services method for use by the client;] v. 22 [production or processing of goods for, or on behalf of, the client;] vi. provision of service on behalf of the client; or vii. a service incidental or auxiliary to any activity specified in sub-clauses (i) to (vi), ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... llant and M/s. Volkswagen is only for limited purpose of sale. We are unable to decipher or agree with this view of the adjudicating authority. In a principal-to-principal transaction, the appellant purchases the cars / products / from the Company by paying the sale consideration. The appellant then becomes the owner of such cars / products and then resells it to its customers. In such process, there cannot be any activity of promoting the sales of M/s. Volkswagen or M/s. Castrol India Ltd. The appellant would be interested to sell more cars to make profit for themselves. The incentives offered for achieving targets of sale cannot be said to be incentives for promoting the sale of M/s. Volkswagen as the appellant is interested to do more sales for their own benefit of making more profit. It cannot be said that they promote the sales of M/s. Volkswagen or M/s. Castrol India Ltd. The incentives depend on the targets achieved which the appellant is interested to achieve as they would earn more profit. Even if there was no such incentive the appellant would be attentive and focused to sell cars to their maximum possible. The incentive is not in the nature of any consideration for provi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... a such sale or purchase of such goods or services; (b) "excisable goods" has the meaning assigned to it in clause (d) of section e of the Central Excise Act, 1944; (c) "manufacture" has the meaning assigned to it in clause (f) of section 2 of the Central Excise Act, 1944." 8. The very same issue was analysed by the Tribunal in the case of M/s. Rohan Motors Ltd. (Supra). The relevant paragraphs read as under: "2. The appellant is a dealer of Maruti Udhyog Ltd. [MUL]. The appellant buys vehicles from MUL for further sale to the buyers by virtue of a dealership agreement dated January 1, 2013 entered into between Maruti Suzuki India Ltd. and the appellant. Under the said agreement, the appellant receives discount form MUL, which are referred to as "incentives" under the scheme. The Department has sought to levy service tax on the incentives received by the appellant under the category of "business auxiliary service" [BAS]. …. ….. 10. As noticed above, the appellant purchases vehicles form MUL. and sells the same to the buyers. It is clear from the agreement that the appellant works on a principal to principa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nder GTA service. Consequently, we set aside the demand under GTA service". 13. The same view was taken by the Tribunal in Commissioner of Service Tax, Mumbai-I Vs. Sai Service Station Ltd. [2013 (10) TMI 1155-CESTAT Mumbai]. 14. In regard to the period post July, 2012, reliance has been placed by the learned counsel for the appellant on an order dated March 23, 2017 passed by the Joint Commissioner, Central Excise in the matter of M/s.Rohan Motors Ltd. The period involved was from October, 2013 to March 2014 and 2014-15. The Joint Commissioner, after placing reliance upon the decision of the Tribunal in Sai Service Station Ltd., observed as follows: "I also find that the ratio of the aforesaid case of CCE, Mumbai-I Vs. Sai Service Station is squarely applicable to the facts of the present case and hold that no service tax can be demanded on the incentive which was in form of trade discounts, extended to the party in terms of a declared policy for achieving sales target. Accordingly, I find that the demand of service tax raised on this count is unsustainable. Thus demand of interest under section 75 of the Act is also no sustainable." 15. The Department, in the present cann ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n of service under Section 65 (44) B. We have already concluded that there is no element of service. The incentives are purely on the basis of sales and not for providing service of promoting the business of M/s. Volkswagen / Castrol India. The demand made after 01/07/2012 also is not sustainable. From the above discussions and following the decision as above we have no hesitation to hold that the demand of service tax raised on incentives / discounts from M/s. Volkswagen and M/s. Castrol cannot sustain and requires to be set aside. Ordered accordingly. 7. The next issue is with regard to the demand confirmed on amount of advance forfeited at the time of cancellation of booking of car. In the case of Lemon Tree Hotel Vs. Commissioner, GST CE & Customs, Indore 2020 (34) GSTL 220 (Tri-Delhi) a similar question was considered wherein the demand of service tax was raised by department on the amount retained on cancellation of advance booking made for accommodation in hotel. It was held that such amount is not liable to levy of service tax under Section 66 E (C) of Finance Act 1994 or under Section 65 (105) (zzz-w) of Finance Act 1994. The relevant paras read as under: "3. So far as ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... le to pay service tax on the liquidated damages recovered for delay in supply and service. The Tribunal answered in the negative and in favour of the assessee. The relevant paras read as under: "5. After hearing both sides, we find that the only issue that is to be decided by us is: whether the Liquidated Damages received by the appellant for tolerating the delay would amount to "declared service" within the meaning of Section 65E (e) of the Act ibid, and consequently, whether the appellant would be liable to Service Tax on the same in terms of Section 668 ibid.? 6.1 The Learned Advocate for the appellant would submit, at the outset, that the issue involved in the case on hand is no more res integra as the same has been settled by the orders of various Benches of the CESTAT, namely - (i) South Eastern Coalfields Ltd. v Commissioner of Central Excise and Service Tax, Raipur [2020 (12) TM1 912 CESTAT, New Delhi 2020-VIL- 559-CESTAT-DEL-ST); (ii) M.P. PoorvaKshetra Vidyut Vitran Co. Ltd. v. Principal Commr., CGST &C.Ex., Bhopal [2021 (46) G.S.T.L. 409 (Tri. Delhi) - 2021-VIL-30 CESTAT-DEL-ST); (iii) Neyveli Lignite Corporation Ltd. v. Commissioner of Cus., C. Ex. & ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 8(44) defines "service" ta mean any activity carried out by a person for another for consideration Explanation (a) to section 67 provides that "consideration" includes any amount that is payable for the taxable services provided or to be provided The recovery of liquidated damages/penalty from other party cannot be said to be towards any service per se, since neither the appellant is carrying on any activity to receive compensation nor can there be any intention of the other party to breach or violate the contract and suffer a loss. The purpose of imposing compensation or penalty is to ensure that the defaulting act is not undertaken or repeated and the same cannot be said to be towards toleration of the defaulting party. The expectation of the appellant is that the other party complies with the terms of the contract and a penalty is imposed only if there is non-compliance. 30. The activities, therefore, that are contemplated under section 66E (e), when one party agrees to refrain from an act, or to tolerate an act or a situation, or to do an act, are activities where the agreement specifically refers to such an activity and there is a flow of consideration fo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to the facts and the issue as to whether appellant is liable to pay service tax on advance amount forfeited on cancellation of booking. We find that the demand of service tax cannot be sustained. This issue is answered in favour of the appellant and against the department. 8.1 The next issue to be addressed is whether the appellant is liable to pay 5% / 6% / 7% of the value of exempted services (trading) as they failed to maintain separate accounts of common inputs availed for taxable services and exempted services. The Ld. counsel for appellant has submitted that appellant has reversed the proportionate credit attributable to trading. The details are also furnished. The department has raised the present demand on this ground for the reason such reversal of proportionate credit as under Rule 6 (3) (ii) cannot be accepted as the appellant has not given prior intimation to the department that they intend to adopt the method of reversal of proportionate credit as under Rule 6 (3) (ii). The issue as to whether the assessee is required to follow only Rule 6 (3) (i) on failure to intimate the department as to the option to reverse proportionate credit is no longer res-integra. It has b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . In the present case, the appellant has availed Cenvat credit in respect of common input services, which has been used in relation to the manufacture of the final product well as for trading of bought out cars. Therefore they are supposed to pay an amount equivalent to Cenvat credit which is attributed to the input service i.e. sale of car. In our view, three options have been provided under sub-rule 6(3), and it is up to the assessee that which option has to be availed. Revenue could not insist the appellant to avail a particular option. In the present case the appellant have admittedly availed option as provided under Rule 6(3)(ii) and paid an amount as required under sub-rule (3A) of Rule 6. As regard the compliance of the procedure and conditions as laid down for availing option as provided under sub-rule (3) (ii), we find that foremost condition is that the appellant is required to pay an amount as per the formula provided under sub-rule (3A) on monthly basis. However, we find that as per the provision, payment on monthly basis is provisional basis, therefore it is not mandatory that whole amount or part of the amount was required to be paid on every month. The appellant thou ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... trading of goods was considered as exempted service from 2011 only, thus it was initial period. We are also of the view that there is condition provided in the rule that if a particular option, out of three options are not opted then only option of payment of 5% provided under Rule 6(3)(i) shall be compulsorily made applicable, therefore we are of the view that Revenue could not insist the appellant to avail a particular option. In the present case admittedly it is appellant who have on their own opted for option provided under Rule 6 (3) (iii). The meaning of the option as argued by the Ld. Sr. Counsel is that "option of right of choosing, something that may be or is chosen, choice, the act of choosing". From the said meaning of the term 'option', it is clear that it is the appellant who have liberty to decide which option to be exercises and not the Revenue to decide the same. 5.4. We find that the appelant admittedly paid an amount of Rs 4,06 785/ plus interest, this is not under dispute. Therefore in our view, the appellant have complied with the condition prescribed under Rule 6(3)(ii) read with sub-rule (3A) of Rule 6 of Cenvat Credit Rules, therefore demand of huge amount ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , in the present case the substantive provisions under Rule 6 (3) (ii) and sub rule (3A) i.e. payment of equivalent to the Cenvat Credit, which the appellant have complied with and if at all there is delay, the required interest has also been paid, therefore in the present case, there is no case of noncompliance of procedure and condition. Therefore, the judgments cited by the Ld. A.R. are not applicable. 6.1. In view of these observations, we are of the considered view that demand confirmed by the adjudicating authority has no legs and therefore the same cannot be sustained. The impugned order is set aside and Appeal is allowed. 8.3. Similar view was taken in the case of M/s. Cranes and Structural Engineers Vs. CCE 2016 (8) TMI 387 - CESTAT, Bangalore. Relevant para is as below: 4.1 On analysis of Rule 6(3A), I find that while exercising the option, the manufacturer of goods or the provider of output service shall intimate in writing to the Department regarding the option exercised. In the present case admittedly there is no intimation given by the appellant informing the exercise of his option. The argument of the Department is that when the appellant has not intimated his o ..... X X X X Extracts X X X X X X X X Extracts X X X X
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