Order date – 17 November 2022

 Facts –

• The Appellant, M/s. ITC Sonar, a unit of ITC Limited, a service provider under the categories of accommodation in Hotels, Inn, Guest House, Club or Campsite etc. Service, Restaurant Service, Convention Service, Outdoor Catering Service etc.
• A Show Cause Notice dated 23.05.2016 was issued alleging that the Appellant had taken irregular CENVAT Credit in the months of September 2014, October 2014 and February 2015 on the basis of several Invoices/Bills of input services after six months of the date of the invoices. It was further alleged that the Appellant had availed irregular CENVAT Credit with intent to evade payment of Service Tax.

Issue –

• Whether the CENVAT Credit has been rightly disallowed under Rule 14 of the CENVAT Credit Rules, 2004 read with Section 73 of the Finance Act, 1994 and whether the penalty imposed under Rule 15 of the CENVAT Credit Rules, 2004 has been rightly imposed?

Order –

• The Tribunal finds that as per Rule 4(1) of CENVAT Credit Rules, 2004 was introduced w.e.f. 01.09.2014 and there is no stipulation in the amending Notification that the same shall apply retrospectively. Rules of interpretation provide that whenever any statute is newly added, the same has got only prospective effect unless it is specifically provided in the amending statute or the amendment is by way of substitution of an existing provision mainly by way of clarification or removal of defects.
• Accordingly, the Tribunal hold that the proviso to Rule 4(1) of CENVAT Credit Rules,2004 has got only prospective effect.
• The Tribunal relied on the decision of the case of Voss Exotech Automotive Pvt.Ltd. v. Commissioner of C.Ex., Pune-I [2018 (363) E.L.T. 1141 (Tri.-Mumbai)] which hold that Notification No.21/2014-CE(NT) dated 11.07.2014 should be applicable to those cases, wherein the invoices were issued on or after 11.07.2014 for the reason that Notification was not applicable to the invoices issued prior to the date of Notification. Therefore, at the time of issuance of invoices, no time limit was prescribed and limitation of six months cannot be made applicable.
• Hence the appeal is allowed.