Custom, Excise & Service Tax Tribunal
Sri Balaji Castings Private Limited ... vs Commissioner Of Gst&Amp;Cce(Chennai ... on 5 October, 2018
1
IN THE CUSTOMS, EXCISE AND SERVICE TAX
APPELLATE TRIBUNAL
SOUTH ZONAL BENCH AT CHENNAI
Appeal No.: E/40005/2018
(Arising out of Order-in-Appeal No. 103/2017 (CTA-I) dated
04.09.2017 passed by the Commissioner of G.S.T. & Central Excise
(Appeals-I), Chennai)
M/s. Sri Balaji Castings Pvt. Ltd., Unit-I, : Appellant
Ambattur, Chennai
Vs.
The Commissioner of G.S.T. & Central Excise, : Respondent
Chennai North Commissionerate Appearance:-
Shri. H. John Babu, Consultant for the Appellant Shri. K. P. Muralidharan, AC (AR) for the Respondent CORAM:
Hon'ble Shri P Dinesha, Member (Judicial) Date of Hearing/Decision:19.07.2018 Date of Pronouncement: 05.10.2018 Final Order No. 42605 / 2018 The assessee has filed this appeal challenging the denial of CENVAT Credit availed on the basis of supplementary invoice issued by the service provider. A Show Cause Notice dated 10.03.2016 was issued for the period November, 2013 to December, 2014 alleging that the appellant had availed incorrect CENVAT 2 Credit of service tax on the basis of supplementary invoice issued for the service tax paid under Voluntary Compliance Encouragement Scheme (VCES), 2013, proposing to recover the same from the assessee, along with applicable interest and applicable penalty.
1.2 The appellant filed its explanation contending inter alia that its service provider, namely M/s. Sri. Venkateshwara Engineering Works had provided Manpower Supply Services for the period April, 2012 to March, 2013; that the proposed demand and the Show Cause Notice was time-barred since the issue was pointed out by the audit party on 13th and 14th of January, 2015 whereas, the proposed Show Cause Notice was issued on 10.03.2016; that the availment of credit was disclosed through the appellant's ER-1 return; that VCES-3 was issued to the service provider which has not been revoked; VCES-3 issued to the service provider has neither been challenged by the Revenue nor has it issued any notice to the service provider as to any fraud or collusion, etc.; that the appellant was not aware as to whether or not its service provider had paid service tax before the issuance of supplementary invoice, etc. 1.3 The adjudicating authority however, vide Order-in-Original dated 26.09.2016 confirmed the demand proposed in the Show 3 Cause Notice, which came to be upheld on appeal by the assessee, before the first appellate authority.
2. When the matter came up for hearing, Shri. H. John Babu, Ld. Consultant, appeared for the assessee and Shri. K. P. Muralidharan, Ld. AR, appeared for the Revenue.
3. I have heard the rival contentions, perused the documents placed on record and have also gone through the judgements relied on during the course of hearing.
4. From the records, it is clear that it is the service provider who had opted for VCES, 2013 and having opted, he had issued supplementary invoice to the appellant. I find force in the plea of the appellant that the Revenue has neither challenged the issuance of VCES-3 to the appellant's service provider nor has the Revenue issued any notice to the service provider alleging fraud or collusion or wilful mis-statement or suppression of facts or contravention of any of the provisions of the Finance Act, 1994, or of the Rules made thereunder, with the intent to evade payment of service tax - which are the requirements of Rule 9(1)(bb) of the CENVAT Credit Rules, 2004 and therefore, I find that the Department having accepted the declaration in terms of VCES and having issued acknowledgement of discharge, cannot seek to recover or deny CENVAT Credit, which 4 would amount to double taxation. This is not the scheme of the taxation Rules.
5. Further, on a perusal of the ER-1 return, I find that the appellant had filed 'Annexure for the details of CENVAT availed' and 'Annexure for the details of service tax', which included at Sl.
Nos. 282, 287 and 288, invoices of its service provider and the Revenue has nowhere suspected or denied the above documents. Also, the contention of the appellant in its reply to the Show Cause Notice that the Department came to know of this fact on 13th and 14th of January, 2015 itself is not disputed by the Revenue.
6. In the peculiar facts and circumstances as above, I find that the denial of CENVAT Credit by the Revenue is bad and unsustainable, for which reason I set aside the impugned Order.
7. As a consequence, the appeal is allowed with consequential benefits, if any.
(Pronounced in open court on 05.10.2018) (P Dinesha) Member (Judicial) Sdd