Custom, Excise & Service Tax Tribunal
M/S. Suzuki Powertrain India Ltd vs Cce, Delhi-Iii, Gurgaon on 28 August, 2015
CUSTOMS, EXCISE & SERVICE TAX APPELLATE TRIBUNAL,
WEST BLOCK NO.2, R.K. PURAM, NEW DELHI-110066
BENCH-SM
COURT IV
Excise Appeal No.E/3020/2009 EX. [SM]
[Arising out of Order-in-Appeal No.216/MA/GGN/2009 passed by the Commissioner of Central Excise (Appeals), Gurgaon]
For approval and signature:
HONBLE MR. S.K. MOHANTY, MEMBER (JUDICIAL)
1
Whether Press Reporters may be allowed to see the Order for publication as per Rule 27 of the CESTAT (Procedure) Rules, 1982?
2
Whether it should be released under Rule 27 of the CESTAT (Procedure) Rules, 1982 for publication in any authoritative report or not?
3
Whether Their Lordships wish to see the fair copy of the Order?
4
Whether Order is to be circulated to the Departmental authorities?
M/s. Suzuki Powertrain India Ltd. Appellant
Vs.
CCE, Delhi-III, Gurgaon Respondent
Present for the Appellant : Shri R.S. Tandon, Advocate Present for the Respondent: Shri R.K. Gupta, D.R. Coram: HONBLE MR. S.K. MOHANTY, MEMBER (JUDICIAL) Date of Hearing/Decision: 25.08.2015 FINAL ORDER NO. __54271/2015__ PER: S.K. MOHANTY
Brief facts of the case are that the appellant is engaged in the manufacture of aluminium casting. During the disputed period, the appellant paid service tax on Consulting Engineer Service received from abroad, in terms of Rule 2(1) (d) (iv) of the Service Tax Rules, 1994, as the recipient of such service and availed Cenvat credit. Taking of cenvat credit was disputed by the Central Excise Department. The show cause proceeding initiated against the appellant, culminated in the adjudication order dated 19.11.2008, wherein the proposals made therein were dropped. Feeling aggrieved with the said adjudication order, Revenue has filed appeal before Commissioner (Appeals), Gurgaon, which was disposed of vide the impugned order dated 21.08.2009 in favour of the Revenue. Hence the present appeal is before this Tribunal.
2. Shri R.S.Tandon, ld. Advocate appearing for the appellant submits that service tax paid by the service receiver under Section 66A of Finance Act, 1994 read with Rule 2 (1) (d) (iv) of Service Tax Rules, 1994 is eligible for Cenvat benefit in terms of clause (ixa) of Rule 3 of the Cenvat Credit Rules, 2004. With regard to the findings of the Commissioner (Appeals) that there is no nexus between the disputed service and the final product manufactured by the appellant, the submissions of ld. Advocate are that such ground has not been raised in the show cause notice, and thus, the Commissioner (Appeals) has traversed beyond the scope enumerated therein.
4. Percontra, Shri R.K.Gupta, the ld. D.R. appearing for the respondent reiterates the findings recorded in the impugned order.
5. I have heard the ld. Counsel for both sides and perused the records.
6. It is an admitted fact that the appellant had paid the service tax as the receiver of taxable service, in terms of Rule (2) (1) (d) (iv) ibid read with Section 66A ibid. Since, Section 66A was not in existing in the statute book at the time of taking cenvat credit; the lower authorities have rightly denied the cenvat benefit. However, since clause (ixa) was inserted in Rule 3 of the Cenvat rules w.e.f. 18.04.2006 by Section 71 of the Finance Act, 2011, which entitles a manufacturer to take cenvat credit of service tax paid under section 66A ibid, I am of the view that the appellant is eligible for the cenvat credit, since the disputed service has been admittedly received by it.
7. I find that there is no allegation in the show cause notice regarding the nexus between the disputed service and the goods manufactured by the appellant. Hence, in absence of any specific allegation made therein, the Commissioner (Appeals), in my opinion, is forbidden under law to decide such issue. Thus, he has travelled beyond the scope of show cause notice, and as such, this ground taken for denial of cenvat benefit is not in conformity with the cannons of justice.
8. In view of the above, I set aside the impugned order and allow the appeal in favour of the appellant.
(Dictated and pronounced in the open Court) (S.K. MOHANTY) MEMBER (JUDICIAL) Anita 0 3 E/3020/2009 EX. [SM]