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2013 (5) TMI 120 - AT - Central ExciseWrong Availment credit on input service - Demand along with interest U/s 11AB - Penalty U/s 11AC of Central Excise Act, 1944 - Held that - The Handling Agency Services are provided by port authority through Customs House Agent for transportation of their clearance of final excisable goods to factory and port. It is nothing but the services in connection with business activities of production and sale of finished goods. - In the similar issue, the department s Appeal has been rejected by the Hon ble CESTAT, Ahmedabad in the case of CCE, Rajkot V/s. Rolex Rings P.Ltd( 2008 (2) TMI 295 - CESTAT, AHMEDABAD). The first appellate authority has followed the law as has been laid down by the various judicial fora and also this bench has in the final orders of Inox India Ltd. (2011 (10) TMI 63 - CESTAT, AHMEDABAD ) and Heubach Colour Pvt.( 2012 (6) TMI 221 - CESTAT, AHMEDABAD) held the same view. The Tribunal is taking a consistent view on this issue - the impugned order is correct, legal and does not suffer from any infirmity - Decided against the revenue.
Issues:
Appeal against order demanding wrongly availed cenvat credit on handling agency service; Interpretation of input service under Cenvat Credit Rules, 2004; Dispute on eligibility of credit for services related to export activities; Applicability of judicial precedents on similar issues. Analysis: The appeal in question challenged an order demanding the reversal of cenvat credit availed on handling agency services not considered eligible under Rule 2(1) of the Cenvat Credit Rules, 2004. The dispute centered around whether the services in question were directly or indirectly related to the provision of output service. The central issue was the interpretation of the definition of input service under the Cenvat Credit Rules, 2004, particularly in the context of services provided for export activities. The appellant, engaged in manufacturing excisable goods, had availed credit on handling agency services for the period from January '08 to June '09, leading to the issuance of a show cause notice for the recovery of wrongly availed credit, along with penalties and interest. The first appellate authority allowed the respondent's appeal, emphasizing that the handling agency services were integral to the business activities of production and sale of finished goods, indirectly related to the manufacturing process. The authority cited judicial precedents, including a case involving CCE, Rajkot v/s. Rolex Rings P.Ltd, to support the admissibility of credit for services utilized during the export process. The authority also referred to the decision of the Hon'ble High Court of Bombay (Nagpur Bench) in the case of Commissioner of Central Excise, Nagpur vs. Ultratech Cement Ltd., highlighting the broad scope of the definition of "input service" under the Cenvat Credit Rules, 2004. The High Court's decision emphasized that the definition includes services used in relation to the business of manufacturing final products, not limited to services directly linked to the manufacturing process. The appellate tribunal upheld the first authority's decision, noting the consistent view taken by the bench on similar issues in previous cases involving different companies. The tribunal emphasized the importance of following established legal principles and judicial interpretations in determining the eligibility of cenvat credit for services related to export business activities. Ultimately, the tribunal rejected the appeal, affirming the correctness and legality of the impugned order, which did not exhibit any procedural flaws or legal deficiencies. The decision highlighted the importance of adhering to legal precedents and established interpretations in resolving disputes related to cenvat credit eligibility under the Cenvat Credit Rules, 2004.
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