WIPRO LTD. Vs. COMMISSIONER OF C. EX., NASIK

JUDGEMENT

(1.) M /s. Wipro Ltd. - the appellants has filed this appeal against the impugned order wherein the prayer for waiver of penalty was denied. The facts of the case are that the appellants had availed CENVAT credit in respect of GTA and legal and professional charges (paid to Chartered Engineer). These services related to the whole of the factory.

(2.) Brief facts of the case are that the appellants engaged in the manufacture of soap, soap noodles and vanaspati and cleared soap and soap noodles against the payment of duty whereas vanaspati are exempted from the payment of duty. It was observed that the appellants had availed CENVAT credit on total amount of service tax paid by them on freight charges for inward transportation of raw material and outward transportation of all finished products cleared by them and on amount of legal and professional charges paid by them. As per Rule 6(2) of CENVAT credit Rules, 2004, "Where a manufacturer or provider of output service avails of CENVAT credit in respect of any inputs or inputs services and manufacture such final products or provides such output service which are chargeable to duty or tax as well as exempted goods or services, then the manufacturer or provider of output services shall maintain separate accounts for receipt, consumption and inventory of input and input services meant for use in the manufacture of dutiable final products or in providing output service and the quantity of input meant for use in the manufacture of exempted goods or services and take CENVAT credit, only on that quantity of input or input service which is intended for use in the manufacture of dutiable goods or in providing output service on which service tax is payable."

(3.) IN this case the appellant did not maintain separate inventory in respect of inward transport of raw material used in the manufacture of vanaspati nor for outward transportation of vanaspati and availed service tax credit of the whole amount for the manufacture of vanaspati also. Show -cause notice was issued under the provisions of Central Excise Act, 1944 for reversal of CENVAT credit availed on input services as mentioned herein above used in vanaspati along with interest and proposal of penalty under Section 11 AC of the Central Excise Act, 1944. The appellant paid the duty along with interest on pointing out by the department during the course of investigation but the adjudicating authority also imposed penalty on the appellants. Against the order -in -original the appellants filed an appeal before the Commissioner (Appeals) for waiver of penalty but the Commissioner (Appeals) confirmed the same. Aggrieved from the same the appellants are before me.