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TMI Blog2024 (3) TMI 801X X X X Extracts X X X X X X X X Extracts X X X X ..... s at the doorstep of the assessee. In fact, since the ST-3 returns are to be filed online, there is no scope for assessee to add any extra information - there is no requirement or provision under the Act to seek clarification from the Department. As far as self-assessment is concerned, it is followed by every assessee in service tax and operating under self-assessment is not a ground on which the extended period of limitation can be invoked. For these reasons, the demand of CENVAT credit for the period up to 30.06.2012 needs to be set aside on this ground of limitation alone. CENVAT Credit - capital goods - 38 tippers - 4 excavators - HELD THAT:- Undisputedly the excavators, tippers and the graders were not exclusively used but were used partly for providing exempted service, namely, road construction and partly used for providing taxable services. For this reason Revenue s appeal needs to be dismissed - Appeal dismissed. Interest on capital goods CENVAT Credit - HELD THAT:- There are force in the contention of the assessee insofar as the order for recovery of interest on this amount of CENVAT credit is concerned. Learned counsel for the assessee is correct in his assertion that CE ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he decided the proposals made in the show cause notice dated 07.08.2014 partly dropping the demand and partly confirming it. Revenue s Appeal No. 54523 of 2015 is assailing the order of the Commissioner holding that the assessee was entitled to credit of Rs. 5,45,741/- on capital goods and seeking demand of appropriate interest and penalty under rule 15A of CENVAT Credit Rules, 2004 [CCR] read with section 78 of Finance Act, 1994. Cross Objections No. 50249 of 2016 has been filed by the assessee in Revenue s appeal. The assessee s Appeal No. 54525 of 2015 is assailing the denial of CENVAT Credit of Rs. 32,04,622/- and imposition of penalty of Rs. 7,46,081/- under rule 15 of CCR and Rs. 5000/- under rule 78 of the Finance Act. 2. The assessee was providing site formation and clearance, excavation, earth moving and demolition services and mining services under section 65 (105) (zzza) of the Finance Act and was paying service tax. It was also providing site excavation service at some road sites which was exempted from payment of service tax by Notification No. 17/2005-ST dated 07.06.2005. Thus, the assessee was providing both taxable and exempted services. 3. A Show cause notice [SCN] ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... id work by a wise man, but has to be condemned and punished with severest of penalties. In view of the facts discussed above, it appears that in such cases meaning of exclusively shall be considered as predominantly or principally or for the purpose or motive of their use to make the Cenvat Credit Scheme workable otherwise absurd result would emerge as the assesses could avail Cenvat credit on any number of movable capital goods depending upon their requirement for exempted service as well by utilizing such goods for a very short period as convenient to them. Further the operandi adopted by the assessee is also a colourable device as the same was not adopted for business exigency but to avail Cenvat credit on all of the equipments purchased by them whether for taxable service or exempted service. As held by Hon'ble Supreme Court in M/s Mcdowel and Company Ltd. v/s Commercial Tax Officer, it appears that such colourable device cannot be taken as correct. It also appears that in the given facts meaning of the word exclusively cannot be read in isolation but it draws its colour from the word 'used' included in Rule 2 of Cenvat Credit Rules, 2014 and meaning of the word ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cenvat credit on tyres and tubes which were issued to the exempted sites have never been brought by the assessee to knowledge of the department as they neither sought any clarification nor declared these facts to the department. These facts have also not been declared in their ST-3 Returns as filed by them. Thereby, they have certainly suppressed the facts from the department. As per the scheme of the law, the service provider is required to determine the admissibility of cenvat credit, classification of their service and payment of service tax on self-assessment basis which they failed to do. In the case of Union of India vs Rajasthan Spinning Weaving Mills, the Hon'ble Supreme Court observed that in case the non-payment of duty if intentional and by adopting any means as indicated in the proviso then the period of notice and a priory the period for which duty can be demanded gets extended to five years. Therefore, the provisions of Rule 14 of the Cenvat Credit Rules 2004 readwith proviso to Section 73(1) of the Finance Act 2004 are applicable for recovery of service tax. 8. We have heard learned counsel for the assessee and learned authorized representative appearing for the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tal goods and had also not sought any clarification from the department. We find the responsibility of the assessee is only to file ST-3 returns. Unless the ST-3 return requires declaration of details of the goods on which the credit was taken, CENVAT credit can be availed without declaring the details and no fault lies at the doorstep of the assessee. In fact, since the ST-3 returns are to be filed online, there is no scope for assessee to add any extra information. If the return calls for aggregate amount of CENVAT credit availed without the invoice-wise breakup, there is no scope for the assessee to provide invoice wise details, let alone, any obligation to do so. We also find that there is no requirement or provision under the Act to seek clarification from the Department. As far as self-assessment is concerned, it is followed by every assessee in service tax and operating under self-assessment is not a ground on which the extended period of limitation can be invoked. For these reasons, we find the demand of CENVAT credit for the period up to 30.06.2012 needs to be set aside on this ground of limitation alone. 14. We have also heard both sides on the merits of the demand. 15. A ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... period between the date on which credit was taken and the date on which the capital goods were used to provide taxable services. According to the appellant, there is no legal provision under which the Commissioner could have demanded interest for this period. Learned counsel for the appellant submits that the only limitation under the CCR with respect to capital goods is that those capital goods which are used exclusively for providing exempted services will not be legible for CENVAT credit. There is no limitation on availing CENVAT credit in respect of capital goods which are used for providing both taxable services and exempted services. There is also nothing in the law which prescribes as to when the capital goods should be put to use in rendering taxable services. The appellant had availed CENVAT credit on the capital goods which were received and used in providing both taxable and exempted services. The impugned order wrongly demanded interest for the period between the date on which the CENVAT credit was taken and the date on which the capital goods were used for providing taxable services. 20. Learned authorized representative appearing for the department supports the impugn ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... they were actually put to use only on road sites services which are exempted from service tax. Therefore, in terms of Rule 6(4) of CCR was wrongly availed by the assessee and denied credit. 27. Learned counsel for the assessee submits that in its reply to the SCN and also at the time of hearing the assessee had submitted that after March, 2013, i.e., after the period of SCN, these capital goods were put to use in providing taxable services also. However, the Commissioner denied CENVAT credit on these capital goods. Learned counsel also asserted that the demand on this ground was also time barred. 28. Learned authorized representative for the revenue supports the impugned order. 29. We have considered the submissions. The Commissioner was correct in stating that as per rule 6(c) of CCR no CENVAT credit can be availed on capital goods which are used exclusively for providing exempted services. However, it is the assertion of the assessee that after the show cause notice was issued, the capital goods were indeed, used for providing some taxable service also this submission was not accepted by the learned Commissioner. Notwithstanding this fact, we find that the demand is time barred. ..... X X X X Extracts X X X X X X X X Extracts X X X X
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