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TMI Blog2018 (8) TMI 1570X X X X Extracts X X X X X X X X Extracts X X X X ..... nufacturing dutiable Ayurvedic goods. The services on which credit was availed was common to both these units. The Chennai Unit who is the respondent herein availed credit on the invoices addressed to them. The department was of the view that they are not eligible to avail 100% input service tax credit and that they ought to have taken ISD registration and distributed the credit proportionately to the Uppal Unit as well as the appellant unit. Show cause notice was issued raising the above allegations and for recovery of the CENVAT credit along with interest and for imposing penalties. After due process of law, the original authority confirmed the demand along with interest and imposed equal penalty. In appeal, Commissioner (Appeals) set asi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... definition of input services as appearing in Rule 2(l) of the CCR could be made eligible to an assessee by way of distribution. This position of the law is also clear from the definition of the term "input service distributor" as defined under Rule 2(m) of CCR reading "an office of the manufacturer or producer of final products or provider of output service which receives invoices issued under Rule 4A of the Service Tax Rules, towards purchases of input services and issues invoice, bill or as the case may be challan for the purpose of distributing credit of tax to such manufacturer or producer as the case may be". This rule thus enables the passing of the credit (distribution) to a manufacturer or provider of output service by an ISD which ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the manufacturer or producer of final products or provider of output service, which receives invoices issued under rule 4A of the Service Tax Rules, 1994 towards purchases of input services and issues invoice, bill or, as the case may be, challan for the purposes of distributing the credit of service tax paid on the said services to such manufacturer or producer or provider, [or an outsourced manufacturing unit] as the case may be; 7. Rule 7 of CCR, 2004 as it stood during the relevant period uses the word "may" and not "shall". The word "shall" was used only in 2016 as argued by the ld. counsel for respondent. Therefore, I find no merit in the appeal filed by the department. The impugned order is upheld and the appeal filed by Revenu ..... X X X X Extracts X X X X X X X X Extracts X X X X
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