75th Founding Day Lecture Meeting on “India@2030” Know More

April 2016

[2016] 66 taxmann.com 196 (Gujarat) – Commissioner of Central Excise and Service Tax vs. Saurashtra Cement Ltd.

By Puloma Dalal
Jayesh Gogri
Mandar Telang Chartered Accountants
Reading Time 1 mins
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There cannot be said to be intention of duty evasion when assessee
relies upon favourable judgment which later on turns out to be against
assessee by order of higher judicial forum.

Facts
By
applying the ratio of a favourable Tribunal judgment, the assessee
availed CENVAT credit of service tax in respect of certain services.
However, said judgment was later reversed by jurisdictional High Court. A
Show Cause Notice for recovery of CENVAT credit was issued to assessee
by invoking extended period of limitation by alleging malafide intention
of evasion of duty. The assessee did not dispute tax demand, but
contended that extended period was not invokable as the Tribunal
judgment relied upon was in their favor at that point of time and there
was no intention of evasion of duty.

Held
The Hon’ble
High Court held that when the issue was disputable and at one point of
time, the view of the Tribunal was in favour of the assessee, extended
period of limitation was not invokable and penalty not leviable.

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