Case Law Details
Urvashi Porwal
Brief of the Case
In the case of M/s. TNT (INDIA) PVT LTD Versus Commissioner of Central Excise and Service Tax BANGALORE-III, it was held that where the credit taken was based on the documents where service tax on the input services was paid in excess mainly on account of wrong calculation by the appellant. When the appellant had taken CENVAT credit for the said excess payment of service tax, it possibly may be called technically irregular CENVAT credit, but again strictly speaking it is a technical flaw, which had occurred mainly on account of wrong calculation and therefore rule 14 of CENVAT credit rules cannot be invoked.
Facts of the Case
The issue concerns with initial excess payment of service tax by the appellant-assessee and thereafter taking CENVAT credit of the said excess payment which has been found to be irregular/wrong. The assessee later on filed a refund claim for the same. The department accepted the refund claim of the assessee and later issued a show-cause notice for recovery of interest and imposition of penalty on the said irregularly taken CENVAT credit. The Department in this case after receipt of refund claim application dated 21.10.2009 of the assessee, asked for reversal of CENVAT credit for consideration of their refund claim application; the appellant informed the department through their letter dated 13.11.2009 that they reversed the CENVAT credit. The Revenue’s main contention for recovery of interest is provisions of Rule 14 of CENVAT Credit Rules, 2004 as existed during the relevant period. The appellant vehemently argues that their initial excess payment of service tax on receipt of input services from their foreign counterpart was unintentional and mainly because of wrong calculations; after the payment of the excess service tax they had taken the CENVAT credit for the same. The different events are tabulated as under:-
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