COMMISSIONER OF CENTRAL EXCISE Vs. COOL COLLECTIONS

JUDGEMENT

(1.) THE Revenue has filed this appeal against the impugned order wherein the adjudication order demanding service tax along with interest and penalty has been set aside. The brief facts of the case are that the respondents are registered with the department under service tax as consignment agent and sales agent. The respondents filed refund claim of Rs. 19455/ - only on the ground that their value of taxable services was Rs. 1,87,409/ - during the period 2005 -06 which remained below the monetary limit of Rs. 4 lakhs. On scrutiny of the refund claim, it was observed that the respondents availed the Cenvat credit on service tax paid on telephone service. Therefore, they were not entitled for the exemption and required to pay service tax on the entire taxable value during the year 2005 -06. Accordingly, the show cause notice was issued and refund claim was denied. On appeal, the Commissioner (Appeals) relying upon the decision of the Apex Court in the case of Shri Hari Chemical Exports Ltd. v. UOI reported in : 2006 (193) E.L.T. 257 (S.C.) allowed the refund claim. Aggrieved by the said order Revenue is in appeal before us.

(2.) NONE appeared for the respondents. Nor any request for adjournment has been received. As the issue is in a narrow compass, the appeal is taken for final disposal. After hearing the learned SDR, we find that the impugned order has been passed by the Commissioner (Appeals) relying upon the decision of the Apex Court in the case of Shri Hari Chemical Exports Ltd. (supra) wherein the Apex Court has held that "only because in his books of accounts entries are made for taking of the credit in terms of one provision of the Rules, the same if ultimately found to be inapplicable and return of the credit is taken effect, we are of the opinion that there cannot be any legal bar in claiming the exemption under another rule." In this case, admittedly the respondents have taken credit on telephone service but have not utilized the credit available for payment of service tax on telephone service and they have reversed the credit balance so they are entitled to claim for the benefit of exemption Notification No. -S.T., dated 1 -3 -2005. Therefore, we do not find any infirmity in the impugned order, the appeal filed by the Revenue is dismissed.