S.N. Jha, J. (President)
1. In the facts of the case, the requirement of pre-deposit is waived and with the consent of parties, we take up the appeal for final hearing and disposal.
2. This appeal filed by the assessee is directed against the order-in-original of the Commissioner of Central Excise, Meerut, dated 11.10.2007 directing recovery of a sum of Rs. 55,58,884/- towards Service Tax to the tune of Rs. 54,49,842/- and education cess to the tune of Rs. 1,09,042/- from the appellant disallowing the Cenvat Credit utilized by the appellant between 01.01.2005 and 15.06.2005 in terms of Rule 14 of the Cenvat Credit Rules, 2004 read with Section 11-A of the Central Excise Act, 1944, and penalty of equal amount besides interest on the amount of Service Tax in terms of Section 11-AB of the Central Excise Act.
3. In view of the order that we propose to pass, it is not necessary to set out the facts of the case in details. Suffice it to say that the appellant availed cenvat credits in terms of the provisions of Rule 3 of the Cenvat Credit Rules, but on the ground that the payment of Service Tax under TR-6 challan cannot be treated as evidence and TR-6 challan cannot be considered as a prescribed document for the purpose of taking Cenvat Credit, the claim was rejected by the Commissioner. On behalf of the appellant, it was submitted that under Rule 9 of the Cenvat Credit Rules, Cenvat Credit can be taken by the manufacturer or the provider of output service or input service distributor, as the case may be, on the basis of any of the documents specified in Clauses (a) to (g) of Sub-rule (1). Challan is a relevant document in terms of Clause (e). The appellant paid Service Tax under TR-6 challan and filed the challans and therefore, it was entitled to avail Cenvat Credits. We find substance in the submissions of the counsel.
4. Rule 9(1)(e) of the Cenvat Credit Rules refers to challan on the document showing payment of Service Tax. In terms of Rule 6(2) of the Service Tax Rules, 1994, the assessee is required to deposit Service Tax in Form i.e TR-6 challan and, therefore TR-6 Challans submitted by the appellant should have been taken to be adequate proof/evidence of payment of Service Tax entitling the appellant to claim cenvat credit. The impugned order of the Commissioner is, therefore, liable to be set aside on this ground alone. However, the Commissioner has not dealt with this and other aspects of the matter and we are therefore of the view that the matter should go back for fresh consideration.
5. In this regard we may point out that in terms of Rule 9(1)(b) of the Cenvat Credit Rules, it is essential that the Service Tax must have been paid by the person liable to pay Service Tax under different sub-clauses as mentioned thereunder. Rule 2(1)(d) of the Service Tax Rules defines person liable for paying the Service Tax. The provisions underwent several amendments from time to time. The amendment relevant for the present purpose was made under Notification GSR 790(c) dated 03.12.2004 w.e.f. 01.01.2005. By the said amendment, the person liable for paying Service Tax in relation to taxable service provided by Goods Transport Agency was the consignor or the consignee of the Goods Transport Agency or any person who paid or was liable to pay freight either himself or through his agent for the transportation of such goods by road or goods carriage. Sub-clause (6) was inserted in Clause (e) of Rule 9(1) of the Cenvat Credit Rules, 2004 under Notification No. 28/05-CE dated 07.06.2005 w.e.f. 16.06.2005. Thus by virtue of the said amendments in the Service Tax Rules and the Cenvat Credit Rules, payment of Service Tax under challan by the person, referred to in Rule 2(1)(d)(v) was to be treated as valid payment so as to entitle him to claim cenvat credit. As mentioned above, the said amendment in Rule 9(1)(e) took with effect from 16.06.2005. The period under dispute in the present case is 01.01.2005 to 15.06.2005. The question for consideration is whether the appellant was covered by Rule 9(1)(e) during the relevant period. We express our opinion on the point as the transactions in question have to be verified by the Commissioner for coming to the conclusion as to whether the appellant was, or not, entitled to claim cenvat credit for the period in question. In this view of the matter, we set aside the impugned order and remand the matter back to the Commissioner for fresh consideration in accordance with law after giving opportunity to the appellant.
6. The appeal stands disposed of in the above terms.
(Dictated and pronounced in the open Court on the 20th day of February, 2008)