Service Tax
TRT-2025-
Cestat New Delhi
Date:-10-04-23
In:-
Issue Favourable to Tax Payer ?:-
Order Date – 10 April 2023
Parties: M/s. Rajasthan Renewable Energy, Corporation Limited Vs Commissioner of Central Excise, Jaipur
Facts –
- The Appellant, M/s. Rajasthan Renewable Energy, Corporation Limited, works as a nodal agency for promotion and development of renewable energy sources under different policies issued by the Energy Department in the Government of Rajasthan.
- On being point out by the Audit team of the Service Tax Department, the appellant had deposited the tax amount and service tax towards the CENVAT credit wrongly availed as well as certain portion of service tax short-paid. On remaining issues, it was contested that the same is not sustainable.
- Two show cause notices dated 24.04.2014 alleging the matters raised in audit report though the appellant had filed a declaration for settling the demand relating to CENVAT credit and show cause notice dated 23.12.2014 alleging the declaration filed by the appellant was ‘substantially false’ as the appellant had not declared full amount of as mentioned in audit.
- The demand proposed in show cause notices were confirmed.
Issue –
- Whether the appellant discharged its tax liability? Whether the appellant had filed a false declaration?
Order -
- The Tribunal observed that the appellant had through three challans paid in cash the amount of CENVAT credit earlier availed by it. Hence it was held that when the entire CENVAT credit availed by the appellant had been reversed, it would amount to non availment of CENVAT credit and the demand for recovery of the CENVAT credit cannot be sustained and rule 6 of the Credit Rules will not be applicable in the present case.
- The Tribunal relied on the decision of the Allahabad High Court in Gularia Chini Mills vs. Union of India it was held that electrical energy is not an excisable goods nor it is exempted goods as defined in rule 2(d) of the Credit Rules. Thus, as electricity is not excisable goods under section 2(d) of the Central Excise Act, 1944, rule 6 of the Credit Rules would not be applicable.
- The promotional or marketing charges recovered by the appellant are in the course of discharge of mandatory statutory functions and the appellant cannot be said to be rendering any services in respect thereof.
- Thus, the appeal is allowed.
updates about central sales tax, list of excise and taxation in Gurgaon, DGFT / SEZ updates, news updates GST Weekly Updates, GST Updates with date, Recent updates in GST till date, latest GST news & updates, GST notification on tax and rate
Download Case Law
