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TMI Blog2025 (1) TMI 1210X X X X Extracts X X X X X X X X Extracts X X X X ..... s the CCR). Although the party contended that the services were of security, but no documents could be produced by them to substantiate their claim; (b) During the months of November, 2010, January, 2011, February, 2011, March, 2011, June, 2011, July, 2011 and September, 2011 the party took excess credit totaling to Rs. 1,79,11,286 in violation of the provisions of Rule 9 (5) of the CCR in respect of capital goods. It was noticed that the credit balance shown in the credit register was less whereas while showing the opening balance in the ST-3 returns for the respective months, the party declared a higher opening balance, thus resulting in said excess credit. Although the party pleaded that the excess credit was related to capital goods which was only taken but was not utilized by them. However they failed to submit any documentary evidence in this regards. (c) The party received credit on the basis of Advice of Transfer Debit (ATD) issued by the CGMT, Dehradun (Input Service Distributor). It was noticed that out of the total credit of Rs. 95,87,097/-, passed by the ISD vide ATD dated 28.02.11, credit of Rs. 25,81,848/- was passed without any supporting document in violat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tative for the department. 3. Ld. Counsel for appellant has submitted that demand of excess cenvat credit of Rs. 1,79,11,286/- service tax is not sustainable. Said demand has been confirmed based on the difference between closing balance of Cenvat credit taken and utilized on inputs and capital goods as mentioned in the credit register and ST-3 returns for the months of November 2010, January 2011, February 2011, March 2011, June 2011, July 2011 and September 2011. It is submitted that the aforesaid difference is due to the fact the Appellant has recorded 100% credit amount on inputs and capital goods under the column of credit taken in ST-3 returns, however has recorded 100% credit amount of inputs and only 50% credit amount of capital goods in its credit register. The same can be corroborated from the ST-3 returns filed and credit register maintained, for the relevant period. 3.1 It is further submitted that the appellant though has taken 100% credit on capital goods in their credit register/books, however, has utilized only 50% thereof in the first year as their eligibility. It has also been informed that the said act is permissible in terms of Rule 4(2)(a) of Cenvat Credit Ru ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... extended period of limitation while issuing the impugned show cause notice, it is submitted that the burden to prove mala fide lies with the department which has not been discharged. All material facts were already in the knowledge of the department. Hence, suppression/mis-representation has wrongly been alleged against the appellant. It is further submitted that non-disclosure of information which was not required to be disclosed under the law does not amount to suppression. The extended period has therefore wrongly been invoked while issuing the impugned show cause notice. The appellant is otherwise a public sector undertaking. The mala fide can never be presumed against the PSUs. The decision in appellant's own case vide Final Order No. 40505/2024 dated 30.04.2024, CESTAT Chennai has been relied upon. Following decisions have also been relied upon: (i) Mahanagar Telephone Nigam Ltd. Vs. Union of India reported as 2023 (73) GSTL 310 (Del.) (ii) GD Goenka Private Limited Vs. Commissioner of Central Goods and Service Tax, Delhi South, Final Order No. 51088/2023 dated 21.08.2023, CESTAT New Delhi (iii) Omega Biotech Ltd. Vs. Commissioner of CGST, Dehradun, Final Order No. 5154 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... period has been invoked by the department while issuing the impugned show cause notice. Impressing upon no infirmity in the order under challenge, the present appeal is prayed to be dismissed. 5. Having heard the rival contentions of both the parties, perusing the entire records including the order under challenge, we observe that following demands proposed in the show cause notice dated 26.08.2015 have been confirmed: Para of the SCN Issue Involved Demand Proposed Demand Proposed 2(a) Inadmissible credit on gardening services 51,606 51,606 2(b) Excess availment of credit on capital goods 1,79,11,286 1,79,11,286 2(d) Inadmissible credit without any detail of input service 59,94,339 59,94,339 2(e) Short payment of Cess amounts 6,46,533 6,46,533 2(f) Interest on late payment of Service tax for September 2011 2,959 2,959 2(g) Short payment of Service tax during the period from April 2012 to June 2012 9,376 9,376 2(h) Non-payment of amount under Rule 6(3) of the Credit Rules related to exempted village panchayat telephones 13,559 13,559 (appropriated) and interest demand confirmed 2(i) Non-payment of amount under Rule 3(5A)(b) ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eady been dealt with by Hon'ble Supreme Court in the case of Ind-Swift Laboratories Ltd. reported as 2011 (265) ELT 3 (SC) and the decision was considered by the Hon'ble High Courts and co-ordinate Benches of the Tribunal in the following decisions among others:- (i) Commissioner of Central Excise and Service Tax, LTU, Bangalore Vs. Bill Forge Pvt. Ltd. [2012 (279) ELT 209 (Kar.)] (ii) M/s. SAIL Vs. Commissioner of GST and Central Excise, Bolpur [E/78557 of 2018 dated 20.09.2019] 7.1.3 The relevant portion of the judgment of the Hon'ble High Court of Karnataka in the case of Bill Forge Pvt. Ltd. (supra) is extracted below:- "7. In the light of the aforesaid material on record and rival contentions, the substantial question of law that arises for consideration in this appeal is as under : "The words "Cenvat Credit has been taken", does it mean making an entry in the account books showing the entitlement of the said credit? or does it mean the said credit found in the account books actually taken while clearing the finished products.?" 20. From the aforesaid discussion what emerges is that the credit of excise duty in the register maintained for the said purpose ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tilizing the availed credit for remittance of duty. 7.1.6 In the light of entire above discussion, we hold that the noticed difference was statutorily permissible and has been denied to be ground for raising the demand of reversal. The unutilized credit has clearly been held as good as the non availed Cenvat credit. In the light of this discussion, we do not find any justification when the demand is confirmed based on the noticed difference in ST-3 returns than to the credit register. The demand of excess Cenvat credit of Rs.1,79,11,286/- is therefore set aside. 7.2 Issue No. 2 7.2.1 For this purpose, we foremost look into the definition of input services given under Rule 2(l) of Cenvat Credit Rules. The definition has undergone tremendous change. We find that the definition of input services prior to 01.04.2011 had two parts i.e. a main part of the definition and an inclusive part of the definition. After 01.04.201, the definition got 3 parts i.e. main part, an inclusive part and an exclusive part also. For a service to qualify as 'input service' under Cenvat Credit Rules, 2004 post 2011, the service in question need not be covered by the very wide definition of manufacture un ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sence of any such provision during the period of dispute, the confirmation of demand invoking such provision is held to have wrongly been confirmed against the appellant. We find no reason to differ from the decision relied upon by the appellant in the case of Ericsson India Pvt. Ltd. (supra). 7.3.2 Above all, we are of the opinion that the Rule 3(5A) cannot apply in a situation where Cenvat credit has not been availed on capital goods. In the present case, the appellant's plea is that the scrap material in question pertains to those capital goods on which the appellant had not availed the Cenvat credit, as majority of those capital goods were purchased prior to 2004 i.e. prior the enactment of Cenvat Credit Rules. The details of those capital goods were duly been provided by the appellants. The onus was of the department to prove that the appellant has availed the Cenvat credit on the capital goods which later got cleared as scrap but there is no such evidence produce. Hence, there is no rebuttal to the said contention of the appellant. We draw our support from the decision of Hon'ble Apex Court in the case of Commr. of C. Ex., Chandigarh Vs. Khalsa Charan Singh and Sons, 2010 (2 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tire material was already to the notice of the department. In such circumstances, the appellant cannot be held accountable for not disclosing the activity of making provision made by it, specifically, when the same was not required in the law. We hold that suppression of facts has wrongly been alleged against the appellant. We rely upon the decision of Anand Nishikawa Co. Ltd. Vs. CCE, Meerut reported as 2005 (188) ELT 149 (SC). 9. Above all, the appellant is a public undertaking unit. This Tribunal in the case of Indian Oil Corporation Vs. Comm. of Central Excise, Ahmedabad reported as 2013 (291) ELT 449 (Tri.-Ahmd.) held that PSU cannot have mala fide intentions for non-disharge of duty and there cannot be an allegations of intention to evade duty. Hon'ble High Court of Punjab & Haryana in the case of Markted Refined oil & Allied Indus held that once the assessee is government organization, it is not easy to infer any evasion of duty much less its intention to do so. 10. In the light of above discussion on three of the above issues based whereupon the original adjudicating authority had confirmed the demand, we hereby set aside the order under challenge confirming demand for th ..... X X X X Extracts X X X X X X X X Extracts X X X X
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