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TMI Blog2017 (1) TMI 924X X X X Extracts X X X X X X X X Extracts X X X X ..... es of the products/services with an intention to boost the sale of the company. In view of the same, the sales commission has a direct nexus with the sales which in turn is related to the manufacture of the products. It is to be understood that there need not be manufacture unless there is sale of product. Hence, the commission paid on sales becomes part of sales promotion resulting in increased manufacturing activity - reliance placed on the decision of the the case of Ambika Overseas [2011 (7) TMI 980 - PUNJAB & HARYANA HIGH COURT], where it was clearly held that the sale and manufacture are directly interrelated and the commission paid on sales needs to be taken as services related to sales promotion. CENVAT credit allowed - appeal allow ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n sales commission would not be admissible. Aggrieved by the said order, the appellant has filed the present appeal. 3. Heard both the parties and perused the records. 4. Learned counsel for the appellant submitted that the impugned order is not sustainable in law as the same has been passed by wrongly interpreting the definition of input service as contained in Rule 2(l) of CCR, 2004 and also the impugned order is against the decisions rendered by the higher judicial fora on the same issue. He further submitted that the impugned order is beyond the scope of show-cause notice which is not permissible as held by the apex court in the decisions of CCE vs. Toyo Engineering India Ltd.: 2006 (201) ELT 513. He further submitted that the impugne ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n this case, the appellant paid commission for doing the sales promotion activities and hence the CENVAT credit is eligible. For this, he relied upon the following decisions: (i) Bhuruka Gases LTd. vs. CCE, Bangalore: Final Order No.20176-20183/2014 dted 31.1.2014. (ii) Jodhani Papers Ltd. vs. CCE, Bangalroe: Final Order No.26720/2013 dated 15.10.2013 (iii) Essar Steel India Ltd. vs. CCE, Surat: 2016-TIOL-520-CESTAT-AHM. (iv) CCE, Ludhiyana vs. Ambika Overseas: 2012 (25) STR 348 (P&H) 5. On the other hand the learned AR would rely upon the decision of Hon ble High Court of Gujarat in the case of CCE, Ahmedabad vs. Cadila Healthcare Ltd. reported in 2013 (30) STR 3 to submit that the activity of commission agent does not amount to s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ce, the commission paid on sales becomes part of sales promotion resulting in increased manufacturing activity. 6.1 Further, I also find that the Hon ble High Court of P & H in the case of Ambika Overseas cited supra have clearly held that the sale and manufacture are directly interrelated and the commission paid on sales needs to be taken as services related to sales promotion. Further, I follow the ratio of Essar Steels India Pvt. Ltd. cited supra, wherein the Division Bench of this Tribunal after discussing all the previous cases and the Rules of interpretation, has held that the Explanation inserted in Rule 2(l) of CCR, 2004 by Notification No.2/2016 is declaratory in nature and is applicable retrospectively. Therefore, in view of the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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