ORDER

(a) I order to demand and recover interest amount of Rs.6,30,94,154/- (Rs. Six Crore Thirty Lakh Ninety Four Thousand One Hundred Fifty Four only) from M/s Dish TV India Limited, FC-19, Sector-16A, Noida, Distt.

Gautam Buddha Nagar (U.P.) under Rule 14 of the

CENVAT Credit Rules, 2004 read with Section 75 of the Finance Act, 1994. Out of the total demand of interest of Rs.12,39,38,369/- I drop the rest of the demand of Rs.6,08,44,215/-. (b) I also impose a penalty of Rs.5,000/- (Rs. Five Thousand only) under Rule 15A of CENVAT Credit Rules, 2004 for contravention of Rule 4(2)(a) of CENVAT Credit Rules,

2004. (c) I set aside the demand of Rs.14,03,43,252/- (Rs. Fourteen Crore, Three Lacs, Forty Three thousand and Two Hundred Fifty two only).

The adjudged dues are ordered to be paid forthwith.”

2.1 The Appellant is engaged in providing output services under the category of Broadcasting Services. He is availing the facility of Cenvat credit.

2.2 During the course of the audit it was observed that the Appellant has been taking credit on the Set Top Boxes provided by them to their customers for receiving the signals and credit was taken by the Appellant treating them as input. It was observed that these goods being classifiable under Chapter 85 were covered by the definition of capital goods and thus the act of taking 100% credit immediately on the receipt of the said goods was not proper and only 50% of credit should have been taken during that financial year and next 50% should have been gone to the next financial year.

2.3 Show cause notice dated 30.03.2013 was issued to the Appellant asking them to show cause as to why the:-

i. Interest Rs.12,29,38,369/- (Twelve Crores Twenty Nine Lacs Thirty Eight Thousand Three Hundred Sixty Nine only) on the excess credit taken on CPE‟s should not be demanded from them under Rules 14 of the CENVAT Credit Rules, 2004 read with Section 75 of the Finance Act, 1994.

ii. An amount Rs.14,03,43,252/- (Rs. Fourteen Crores Three Lacs Forty Three Thousand Two Hundred Fifty Two only) should not demanded under Rule 14 of CENVAT Credit Rules, 2004 read with Section 73 of the Finance Act, 1994.

iii. Interest on the said amount should not be demanded from them under Rules 14 of the CENVAT Credit Rules, 2004 read with Section 75 of the Finance Act, 1994.

iv. Penalty should not be imposed under the provision of Rule 15 of the CENVAT Credit Rules, 2004 read with Section 78 of the Finance Act, 1994.

2.3 The show cause notice has been adjudicated as per the impugned order.

2.4 Aggrieved Appellant has filed this appeal. 3.1 We have heard Shri A. R. Madhav Rao, Shri Tushar Joshi, Shri Mukunda Rao & Shri Nishant Mishra Advocates for the Appellant and Shri Santosh Kumar Authorized Representative for the Revenue.

3.2 Arguing for the Appellant, learned counsel submits that ➢ the Appellant has taken credit on the set top boxes by treating them as input as there is no restriction in the definition as per Rule 2 (k) of Cenvat Credit Rules, 2004, which excludes these from the definition of inputs;

➢ these set top boxes have been used by the Appellant for providing the output services and hence correctly covered under the said definition.

➢ the same goods may be input or capital goods depending upon the nature of their uses by the person and it is settled principal where two benefits are available subject to satisfying the condition precedent, the Appellant is free to avail either, which is more beneficial,- ○ Share Medical Care [2007 (209) E.L.T. 321 (S.C.)] ➢ The definition of inputs is wide enough to cover these set- top boxes under that category. Reliance placed on following decisions:-

○ Banco Products (India) Ltd. [2009 (235) E.L.T. 636 (Tri.-LB)];

○ Zenith Papers [2002 (146) E.L.T. 518 (P & H)]; ○ Harcharan & Brothers [2002 (149) E.L.T. 73 (P & H)]; ○ Modi Rubber [2000 (119) E.L.T. 197} ➢ The Department wants to put these goods under the category of capital goods only for the reason that these goods have b