Case Law Details
Brief of the CaseIn the case of Commissioner of Central Excise & Service Tax Vs. M/s. Thiru Arooran Sugars Ltd., Hon’ble Madras High Court held that the CENVAT credit of the service tax paid in respect of cell phone services, catering services and service tax paid on the Goods Transport Agency services in respect of freight charges paid for the outward movement of goods is allowed.
Brief Facts of the Case
The assessee manufactures sugar, molasses, rectified spirit (non-excisable), extra neutral alcohol (exempted), ethanol, denatured ethyl alcohol and fuel oil (dutiable). The assessee was availing Cenvat credit of duty paid on the capital goods and inputs and the service tax paid in respect of input services as per the Cenvat Credit Rules, 2004. On verification of the records it was noticed that the assessee had availed credit of the service tax and education cess paid in respect of cell phone services, catering services and service tax paid on the Goods Transport Agency services in respect of freight charges paid for the outward movement of sugar. It appears that the above said services were not in relation to the manufacture and clearance of final products, as provided under Cenvat Credit Rules. Therefore, the assessee was issued with a show cause notice and after due process of law the adjudicating authority has ordered recovery of Cenvat credit under proviso to Section 73 and 75 of the Finance Act, 1944 read with Rule 14 of Cenvat Credit Rules and also imposed penalty under Rule 15 of Cenvat Credit Rules.
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