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TMI Blog2014 (2) TMI 482X X X X Extracts X X X X X X X X Extracts X X X X ..... (ii) of the definition of ‘input service’ - since this issue was one of legal interpretation of rules wherein two views were possible, demand may be restricted to normal period of limitation. - Decided partly in favor of assessee. - Appeal No.S/239/2007 - FINAL ORDER No.40051/2014 - Dated:- 24-1-2014 - Shri Mathew John, J. For the Appellant : Shri Hari Radhakrishnan, Advocate For the Respondent : Shri P. Arul, Superintendent (AR) JUDGEMENT 1. The appellant is engaged in the manufacture of sugar confectionaries. They avail Cenvat credit of duty paid on inputs and capital goods and input services in terms of Cenvat Credit Rules, 2004. Their factory is situated at Nellikuppam, Pondicherry. During the period Jan 05 to Aug 06 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ellant on GTA service for transportation of goods from their depot to the dealers on the basis of distribution challans issued by the Zonal office. Revenue was also of the view that such transportation beyond the place of removal is not covered by the input service as defined under rule 2(l) of CCR 04 and therefore proposed to deny Cenvat credit taken on such transportation amounting to Rs.2,43,604/-. On adjudication, a total demand of Rs.12,14,978/- was confirmed in terms of Rule 14 of CCR 04 read with proviso to sub-section (1) of section 11A and section 11AB of the Act. Further, a penalty of Rs.5000/- was imposed under section 15 (3) of CCR 04. Aggrieved by the order, the appellant filed an appeal with the Commissioner (Appeals) who ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on 11-10-06 for the period Jan 05 to Aug 06 is partly time-barred as no intention to evade payment of service tax can be attributed to the appellant. He submits that appellants availed service tax credit in a bonafide manner. 6. The Ld. Advocate invites attention to Rule 10A of Central Excise Valuation Rules, 2000 to argue that the concept of principal manufacturer is recognized by the department in the matter of Central Excise levy. He also made a submission that final goods bore the brand name of the appellant and therefore it has to be considered that the manufacturing activity was done by the job worker on behalf of the applicant. 7. The appellant also argues that in terms of Notification 214/86-CE and Rule 4 (5) (a) of CCR 04, the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ayer, Ld. AR for Revenue submits that the Tribunal and High Courts have always been holding that a supplier of raw material is not a "manufacturer" and the duty liability has to be determined in the hands of the job worker. He further submits that in this case the duty was not paid by the appellant. The appellant who had not done manufacturing activity or paid the excise duty cannot be considered as the "manufacturer" for such goods. He also points out that in this case no declaration under Notification 214/86-CE was filed by the job worker to the effect that appellant will be paying duty on the goods manufactured and this cannot be considered as a technical lapse. Since the appellant had not followed the provisions of law or done any manuf ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Vs CCE Chennai - 2007 (8) STR 124 (Tri.-Chennai) as affirmed by Hon. High Court of Madras as reported at 2013 (288) E.L.T. A23 (Mad.). 14. I have considered submissions on both sides. This is a case where the appellant did not do the manufacturing activity in respect of the goods for which Cenvat credit of input services was taken. Neither did the appellant pay excise duty on such goods. Both manufacturing and duty payment were done by job-workers. In such a situation there is no justification to consider the appellant has manufacturer for the purpose of taking Cenvat credit in respect service tax paid on transportation of inputs and final products. In the various decisions relied upon by the appellant the assessee has done either a part ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... icted to the normal period of one year. 18. The case credit taken for transportation from depots to their dealers also, I find that during the relevant time there was considerable confusion about the scope of the expression service used for clearance of final products from the place of removal which was used in definition at Rule 2 (l) (ii) of the definition of input service . In fact the decision of the Hon. Karnataka High Court in the case of ABB Ltd is to the effect that such credit was could be allowed upto 01-04-08. However, I follow the decision of the jurisdictional High Court in the case of India Japan Lighting Pvt. Ltd. (supra) in this matter. But since this issue was one of legal interpretation of rules wherein two views were ..... X X X X Extracts X X X X X X X X Extracts X X X X
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