Custom, Excise & Service Tax Tribunal
M/S. Spice Communications Limited vs Commissioner Of Central Excise, ... on 16 January, 2017
CUSTOMS, EXCISE & SERVICE TAX APPELLATE TRIBUNAL SOUTH ZONAL BENCH BANGALORE Appeal(s) Involved: ST/495/2010-SM [Arising out of Order-in-Appeal No. 149/2009 dated 11.12.2009 passed by the Commissioner of Central Excise (Appeals-II), Bangalore.] M/s. Spice Communications Limited No.75, Civil Station, Richmond Road, BANGALORE 560 025 Appellant(s) Versus Commissioner of Central Excise, Service Tax And Customs (Appeals-II) SP Complex, Lalbagh Road BANGALORE - 560027 KARNATAKA Respondent(s)
Appearance:
Mr. G. Shivadass, ADVOCATE For the Appellant Mrs. Ezhilmathi, AR For the Respondent Date of Hearing: 09/01/2017 Date of Decision: 16/01/2017 CORAM:
HON'BLE SHRI S.S GARG, JUDICIAL MEMBER Final Order No. 20047 / 2017 Per : S.S GARG The present appeal is directed against the impugned Order-in-Appeal dated 11.12.2009 passed by the Commissioner of Central Excise (Appeals) whereby he has confirmed the recovery of CENVAT credit availed by appellant along with interest and also imposed penalty.
2. Briefly the facts of the case are that appellants are provider of telephone services and they are availing CENVAT credit of excise duty paid on prefabricated shelters. The appellant submitted the details of the credit taken on shelters for the period 10.9.2004 to 30.9.2006 to the extent of Rs.1,20,960/- to the Department vide letter dated 22.1.2008. Subsequent to the information submitted by the appellant, the department issued a show-cause notice dated 2.6.2008 invoking extended period of limitation. Thereafter a show-cause notice was issued proposing to deny the CENVAT credit. Appellant filed reply to the show-cause notice and after due process of law, the Assistant Commissioner rejected the claim of the appellant vide Order-in-Original dated 18.8.2008. Aggrieved by the said order, the appellant filed appeal before the Commissioner (A) who upheld the Order-in-Original and confirmed the demand and hence the present appeal.
3. Heard both the parties and perused the record.
4. Learned counsel for the appellant submitted that the impugned order is not sustainable in law on merit as well as on limitation. He further submitted that the appellants are entitled to CENVAT credit on tower/tower materials and prefabricated building/shelters as the same has been availed by the appellant as the capital goods. He also submitted that the appellants are entitled to avail CENVAT credit on tower/tower material and prefabricated shelters as inputs. He further submitted that though the appellant is entitled to CENVAT credit but there are certain decisions which are against the appellant and the matter is pending before the Honble Supreme Court for final decision and therefore he is not arguing on merit in the present case but only confining his arguments to time bar because according to him the entire demand is time barred in the facts and circumstances of the case. He further submitted that in the present case, the show-cause notice was issued on 22.7.2008 for the period from 2004 to 2007. He further submitted that the appellant had submitted the information vide his letter dated 21.1.2008 and the credit on shelter was availed for the period from 10.9.2004 to 30.9.2006 alone. He further submitted that the learned Commissioner (A) has wrongly justified the invocation of extended period of limitation on the ground that in ST-3 returns filed by the appellant, the relevant information about the availment of CENVAT credit on angles, channels, beams and prefabricated buildings have been conspicuously missing and thereby the appellants have suppressed the fact justifying invoking extended period of limitation. In reply to this, the learned counsel for the appellant further submitted that they have been regularly filing ST-3 returns wherein they have mentioned the amount of credit availed by them, therefore the fact that appellants were availing credit on tower/tower material was known to the department. There was no requirement in return to mention about the items on which credit was availed. Had there been any doubt, the Department could have verified the details from the appellant. Therefore, no suppression could be alleged against the appellant for invoking extended period of limitation. He further submitted that the show-cause notice was issued based on the information provided by the appellant and therefore the fact that appellants were availing credit on tower/tower material was known to the department and no suppression can be alleged against the appellant for invoking extended period of limitation. He further submitted that availability of credit on tower and tower material is contingent upon a question of law involving the interpretation of complex legal provision and therefore invocation of extended period of limitation is not warranted. He also submitted that the instant issue has been a subject matter of dispute since the very beginning when the Board issued a circular dated 26.6.2008 directing the department to recover irregular credit availed on towers and parts thereof such as angles, channels and beams of steel, etc. but this Circular was issued after the impugned order was passed. He also submitted that in the context of the term accessory, there was plethora of decisions in favour of the appellant demonstrating that the goods in question were admissible as capital goods. Learned counsel further submitted that following decisions were against the appellant.
i. Bharati Airtel Ltd. vs. CST, Pune: 2013 (29) STR 401 (Tri.-Mum.) ii. Bharati Airtel Ltd. vs. CCE, Pune-III: 2014 (35) STR 865 (Bom.) iii. Vodafone India Ltd. vs. CCE, Mumbai: 2015 (324) ELT 434 (Bom.) He also placed reliance on the following decisions which were in favour of the appellant.
i. GTL Infrastructure Ltd. vs. CST, Mumbai: 2015 (37) STR 577 (Tri.-Mum.) ii. Reliance Infratel Ltd. vs. CST: 2015 (38) STR 984 (Tri.-Mumbai) iii. Essar Telecom Infrastructure Ltd. vs. CST, Mumbai: 2015 (40) STR 591 (Tri.-Mumbai) iv. Reliance Communication Infrastructure Ltd. vs. CST, Mumbai-I: 2015 (40) STR 591 (TR) He further submitted that when the issue in dispute has been referred to Larger Bench relating to the subject matter of interpretation then in that case extended the period of limitation is not invocable. In support of his submission, he relied upon the following decisions:
(i) Tower Vision India Pvt. Ltd. & Bharti Infratel Ltd. vs. CST, Delhi: 2015-TIOL-1895-CESTAT-DEL.
(ii) Tower Vision India Pvt. Ltd. vs. CCE (Adj.), Delhi: 2016 (42) STR 249 (Tri.-LB)
(iii) General Manager, Consumer Mobility, BSNL vs. CCE & ST, Chandigarh: 2014-VIL-325-CESTAT-DEL-ST
(iv) Tata Teleservices Ltd. & Ors. Vs. CST, Pune: 2015-TIOL-628-CESTAT-MUM.
(v) M/s. Vodafone Essar Digilink India Ltd. vs. CCE, Panchkula: 2016-TIOL-873-CESTAT-CHD.
5. On the other hand, the learned AR vehemently defended the impugned order and submitted that the appellants have wrongly availed CENVAT credit and therefore they are liable to pay interest and penalty along with CENVAT credit. She further relied upon the various circulars issued by the Board and the judgment in the case of Bharti Airtel and Vodafone India Ltd. which are cited above to submit that on merit till today the decisions are in favour of the Revenue and against the assessee. She further submitted that in the case of Triveni Engineering and Industries Ltd. vs. CCE: 2000 (120) ELT 273 (SC), the issue has been settled in favour of the Department.
6. I have considered the submissions of both the parties and have gone through the various decisions cited at the bar. I find that though instant issue is against the appellant on merit which has been fairly conceded by the appellant but on limitation the issue is in favour of the appellant because the department has failed to prove suppression of facts invoking extended period of limitation. Appellants have been filing the returns regularly and from the documents submitted by the appellant only the show-cause notice has been issued. It is a fact that the instant issue has been subject matter of various litigation before various judicial forum and till today the matter is pending before the Honble apex court for final determination. In view of these facts, the appellant has bona fide reasons to believe that he is entitled to the CENVAT credit and he has disclosed the same in his ST-3 returns. Therefore, in view of these facts, I find that the entire demand is time barred and therefore, I set aside the impugned order and allow the appeal of the appellant with consequential relief, if any.
(Order was pronounced in Open Court on 16/01/2017.) S.S GARG JUDICIAL MEMBER rv 7