Ineos Styrolution India Ltd. Vs C.C.E. & S.T. (CESTAT Ahmedabad)
The appeal was filed by M/s Ineos Styrolution (India) Ltd. against demand for reversal of CENVAT credit, interest and penalty under Section 78 of the Finance Act read with Rule 15(2) of the CENVAT Credit Rules, 2004. The appellant was registered as an input service distributor and had distributed CENVAT credit to its manufacturing plants through ISD invoices.
During audit, the CERA Auditor pointed out that the Nandesari Manufacturing Unit had availed CENVAT credit of service tax paid under the Voluntary Compliance Encouragement Scheme, 2013 (VCES), relating to service tax on import of service described as Corporate Cost Sharing Expenses for the year 2012. The appellant had opted for VCES and paid service tax of Rs. 1,80,29,207/-, subsequently availing CENVAT credit of the amount in its ST-3 Returns for October 2014 to March 2015 filed on 24.04.2015.
The Revenue sought reversal of the credit by invoking Rule 9(1)(bb) and Rule 9(1)(e) of the CENVAT Credit Rules, 2004. The appellant contended that Rule 9(1)(bb) did not apply to service tax paid under reverse charge by a service recipient and that credit was available on the basis of the challan prescribed under Rule 9(1)(e). It also challenged the extended limitation period and contended that the relevant facts had been disclosed in the ST-3 return and that the issue was interpretational.
