At, Customs Excise Service Tax Appellate Tribunal Regional Bench Hyderabad
By, THE HONORABLE JUSTICE: M.V. RAVINDRAN
For Petitioner: Ch. Sumanth, Consultant And For Respondents: M. Chandra Bose, Additional Joint Commissioner (AR)
1. All these three appeals are directed against the same Order-in-Appeal No. HYD-SVTAX-000-APP-0030-0032-16-17-ST dated 29.04.2016.
2. Heard both sides and perused the records.
3. The issue involved in all these appeals being common, they are disposed of by a common order. The issue that falls for consideration is whether the appellants are required to reverse the CENVAT Credit attributable to the inputs which are common input services which have been consumed for rendering taxable output services as well as non-taxable output services like trading activities. It was the case of the appellant that trading activity is not exempted service prior to 01.04.2011 and hence the question of reversing an amount attributable to the trading activity does not arise. It is the submission that subsequent to 01.04.2011 there is an amendment to the provisions which clearly mandates that trading activity is also falls under exempted service.
4. Ld. DR submits that an identical issue was decided by the Hon'ble High Court of Chennai in the case of M/s. FL Smidth Private Ltd., [2014-TIOL-2186-HC-MAD-CX] and their lordships after the question of law involved in paragraph No. 1 have held in the favour of the Revenue. It is according to the said question of law framed. Ld. DR also submits that same issue came up before this Bench in the case of Vibrant Automobiles India Private Ltd., in appeal No. ST/30617/2016 which was disposed of by this Bench by Final Order No. A/30612/2017 dated 02.05.2017 wherein following the judgment of the Hon'ble High Court of Madras in the case of M/s. FL Smidth Private Ltd., (supra) the appeal was disposed of.
5. On careful consideration of the submissions made and the case laws cited by the Ld. DR, I find that I have taken a view in the case of Vibrant Automobiles India Private Ltd., wherein similar issue came up before the Bench as to whether the trading activities prior to 01.04.2011 have to be considered as non-taxable services or exempted services following the judgment of the Hon'ble High Court of Madras, I have taken a view that prior to 01.04.2011 also the trading activity would amount to exempted service. I have no reason to deviate from the said view taken by the Bench especially following the judgment of Hon'ble High Court of Madras. In view of this, the appeals filed by the appellants are rejected.
6. As regards penalties, since the issue involved in these case
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s was contested before various higher forums, I find there is no reason to visit appellant with penalties. Accordingly, the penalties imposed under the provisions of Rule 15 of the CENVAT Credit Rules are set aside. 7. The appeals are disposed of as declared above.