C.C.E. & S.T.-Vadodara-I vs Checkmate Services Pvt Ltd

Somesh Arora, Member (J)

The dispute pertains to reversal of credit on exempted services during the period April, 2016 to March-2011 in relation to “Security Agency Services” and “Man Power Recruitment Agency Services” provided to SEZ Units and J & K Units both being exempted services and accepted by department as such. The Learned Commissioner gave the finding in favor of the party, department is aggrieved as it finds that the procedure of maintaining separates account and filing monthly returns etc was not followed. However, it is not disputing the quantum of credit, which was reversed by the party at the investigation stage.

The learned Advocate relies on the decision of 2023 (8) TMI 1135 of this bench only in the matter of Thermotech System Ltd Vs. C.C.E-CESTAT Ahmedabad. In which in the face of reversal of proportionate Cenvat credit demand was dropped and only verification of the credit reversed was required. It is his submission that in the instant case, even that situation is not there as in the page no. 24 of the Order-In-Original it is clearly mentioned that the amount has been verified. The same Para is being reproduced below:

“24. I have noticed that the noticee have voluntarily reversed the Service Tax credit amounting to Rs 1,31,628/- (incl. Interest thereon) towards reversal against credit availed on common Services which has been proposed to be appropriated under Rule 14 of the Cenvat Credit Rules, 2004. The fact of such reversal on proportionate basis has also been admitted as evident from the narration appearing in Para 8 on page 2 of the show-cause notice. Moreover, vide Para 11(2) on page 3 of the show-cause notice, it remains proposed to appropriate such payment of Rs. 1,31,628/-. Thus, there is no doubt about the reversal of amount on proportionate basis by the assessee. During the present adjudication proceedings also, the assessee has produced before me the calculation of such proportionate basis, which is found to be in order.”

In view of the decision confronted by the learned Advocate as well as one relied upon by the original authority Learned A.R reiterates allegation and grounds. We find that the order of Commissioner is sustainable in view of the decision cited (supra).

Accordingly, appeal of the department is dismissed.