Decided on February 19,2015



R. Periasami, Member (T) - (1.)REVENUE filed appeal against the Order -in -Appeal dt. 9.11.2009.
(2.)THE brief facts of the case are that the respondents were registered with service tax as commission agents and also engaged in trading of M.S. Scraps, M.S. Angles and CTD Bars. During audit of the records, it was noticed that respondent had availed cenvat credit of Rs. 7,01,979/ - on certain ineligible input services as well as utilised excess credit of Rs. 6,78,459/ - on common input services used for both trading as well as taxable service. On being pointed out the respondents paid the entire amount along with interest and subsequently filed refund claim. The appellants also had taken credit of Rs. 6,78,459/ - paid by them in their cenvat credit account. The adjudicating authority has issued a show cause notice dt. 3.3.2009 for rejection of the claim. Vide OIO No. 33/2009 dt. 29.4.2009, the adjudicating authority has rejected the refund claim under the provisions of Rule 6(3)(c) and Rule 2(1) of Cenvat Credit Rules, 2004. On appeal filed by the respondents, the Commissioner (Appeals), has allowed their appeal and set aside the impugned order with consequential relief. The Revenue filed the present appeal against the impugned order.
Heard both sides.

(3.)LD . AR reiterated the grounds of appeal and the findings of the OIO. Since the respondents are carrying out both taxable service under BAS and trading of the goods, they are not eligible to avail credit as common input services and they have not maintained separate accounts and they are entitled only to 20% of the total service tax payable as credit on common input services. The amount paid by the respondents is only credit amount in excess of 20% which was already allowed. He also submits that respondents also availed credit on the ineligible inputs services viz. banking services, maintenance and repair services, insurance service, fire insurance service, testing and analysis service, clearing and forwarding agent services. All these services have no nexus with the output service rendered by the respondent which is a commission agent service. He relied on the Tribunal's decision in the case of Mercedes Benz India Pvt. Ltd. v. CCE Pune -I - : 2014 (36) STR 704 (Tri. -Mumbai).

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