9911796707
TMI Blog2024 (11) TMI 1229X X X X Extracts X X X X X X X X Extracts X X X X ..... d service and therefore, cenvat credit is not available for the exempted services. Taking of irregular credit on the trading activity was known to the appellant and from 01.03.2011 they were not liable to avail cenvat credit on the trading activities - after the amendment with effect from 01.04.2011 wherein trading activity was specifically included in the negative list, clearly establishes that trading activities are to be considered as exempted services and any credit taken on the exempted service needs to be reversed. From the above Final Order, it is also seen that the demand was confirmed for the period 01.04.2011 to 31.03.2012 which was dropped only on limitation. The appellant being aware of this fact, continued to take credit even a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er is remanded for re-determining the proportionate cenvat credit along with interest on the trading activities that are considered to be exempted. - HON'BLE MRS. R. BHAGYA DEVI, MEMBER ( TECHNICAL ) Ms. Gomathi Srinivas , Advocate for the Appellant Mr. Neeraj Kumar , Superintendent ( AR ) for the Respondent ORDER PER : R. BHAGYA DEVI This appeal is filed against Order-in-Appeal No. MYS-EXCUS-000-APP-MSC-101-2020-21 dated 20.01.2021 passed by Commissioner (Appeals) Central Tax, Central Excise and Service Tax, Mysuru. 2. The appellant, M/s. Prerana Motors, are providers of services of Repair, reconditioning, restoration and decoration of motor vehicles and Business Auxiliary Services. During audit, it was noticed that the appellant was ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ee shall submit half yearly returns in form ST- 3 in triplicate for the months covered in the half yearly return and accordingly, the appellant had uploaded the returns for the relevant period October 2015 to March 2016 within time. However, the uploaded returns were rejected by the portal due to some unspecified technical error which was in no way the fault of the appellant, therefore, alleging mala fide intent is unmaintainable and imposition of penalty on this count is unjust and improper. He relied on the decision in the case of M/s. Hindustan Steel Ltd. vs. M/s. State of Orissa: AIR 1970 (SC) 253. 3.1 With regard to the trading activity, it is submitted that the appellant sells spare parts and other goods as consumables in the course o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... -14 to 2017-18 (upto June 2017). Second issue is with regard to levy of penalty for non-filing of ST-3 returns, thus, contravening the provisions of Rule 7 of Service Tax Rules, 2004 read with Section 70 of the Finance Act, 1994. 5.1 The Cenvat Credit Rules, 2004 read with Section 66D of the Finance Act, 1994 clearly states that trading activity is an exempted service and therefore, cenvat credit is not available for the exempted services. In the appellant s own case for another unit vide Final Order No. 20158/2019 dated 12.02.2019, the Tribunal observed as follows: 6. After considering the submissions of both sides and perusal of the material on record and the various decisions, I find that the Commissioner (Appeals) has dropped the demand ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 1.04.2011 wherein trading activity was specifically included in the negative list, clearly establishes that trading activities are to be considered as exempted services and any credit taken on the exempted service needs to be reversed. From the above Final Order, it is also seen that the demand was confirmed for the period 01.04.2011 to 31.03.2012 which was dropped only on limitation. The appellant being aware of this fact, continued to take credit even after the amendment and after confirmation from department on merits in their own unit at Bangalore South for the period 01.04.2011 to 31.03.2012. This clearly establishes that appellant had suppressed this fact and continued to avail the credit, the fact that they have filed the returns reg ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ction 78 of the Finance Act, 1994 is set aside. 6. With regard to penalty for non-filing of returns, it is noticed that the appellant had filed the returns but uploaded returns were rejected by the portal due to some unspecified technical error from the records placed before us and hence, as rightly claimed by the appellant they cannot be penalised for non-filing of returns. Accordingly, the penalty imposed under Section 77(2) of the Finance Act, 1994 is set aside. 7. With regard to demand under Rule 6(3) of the Cenvat Credit Rules, 2004 the matter is remanded for re-determining the proportionate cenvat credit along with interest on the trading activities that are considered to be exempted. The appeal is disposed of in the above terms. ( Or ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
