Case Law Details
Ardex Endura (India) Pvt Ltd Vs Commissioner Of Central Tax (CESTAT Bangalore)
Appellants are not liable to penalty on wrong availment of GTA services up to the customer’s premises because it was an interpretation issue and was settled by the Apex Court in the year 2018in the case of Ultratech and therefore no intention to evade service tax can be imputed on the appellant.
FULL TEXT OF THE CESTAT JUDGEMENT
The present appeal is directed against the impugned order dated 13 03.2018 passed by the Commissioner (Appeals) whereby the Commissioner (Appeals) has disallowed the credit of Rs. 8,92,587/- (Rupees Eight Lakhs Ninety Two Thousand Five Hundred and Eighty Seven only) and also demanded interest and imposed equal penalty in terms of Section A1C of Central Excise Act read with Rule 15(2). The Commissioner (Appeals) has dropped the demand of Rs. 31,39,893/- (Rupees Thirty One Lakhs Thirty Nine Thousand Eight Hundred and Ninety Three only) along with interest and penalty. In the present appeal, appellant has only challenged the denial of cenvat credit of Rs. 6,83,245/- (Rupees Six Lakhs Eighty Three Thousand Two Hundred and Forty Five only). Briefly the facts of the present case are that the appellants are engaged in the manufacture of flooring leveling compounds, tile adhesive and grouts, water proof compounds, etc. and are availing the facility of cenvat credit under the provisions of Cenvat Credit Rules, 2004. During the course of audit, it was noticed that the appellant availed service tax credit on the services such as rent paid in respect of other branches and depots, courier service in respect of finished goods sent to customers, legal services, auditing services pertaining to branches, telephone charges of branches, export clearing charges, pest control charges, branches accounting software, exhibition charges, advertisement of branches, air travel agent services etc. They availed cenvat credit on such services amounting to Rs. 4032480/- (Rupees Forty Lakhs Thirty Two Thousand Four Hundred and Eighty only) during the period from July 201to March 2014. Department entertained the view that the appellant has wrongly availed the cenvat credit on these input services because all services are not directly or indirectly used in or in relation to the manufacture of final products. Department also alleged that the appellant has wilfully suppressed the material fact with intent to avail cenvat credit on ineligible services and therefore are rendered themselves liable for imposition of penalty. Accordingly, a show-cause notice was issued and after following the due process, Additional Commissioner vide order dated 29.05.2015 confirmed the demand of irregular credit along with interest and imposed penalty. Aggrieved by the said order, appellant filed appeal before the Commissioner and the Commissioner (Appeals) vide the impugned order reduced the tax demand from Rs. 4032480/- (Rupees Forty Lakhs Thirty Two Thousand Four Hundred and Eighty only) to Rs. 8,92,587/- (Rupees Eight Lakhs Ninety Two Thousand Five Hundred and Eighty Seven only) as per the table given below:
