9911796707
TMI Blog2021 (5) TMI 366X X X X Extracts X X X X X X X X Extracts X X X X ..... 4 for its Indian Leaf Tobacco Division in Guntur. The aforesaid registration enables distribution of service tax paid input credits to manufacturing activities carried on in the factories. A division bench of this court in COMMISSIONER OF C. EX., BANGALORE-I VERSUS ECOF INDUSTRIES PVT. LTD. [ 2011 (2) TMI 1130 - KARNATAKA HIGH COURT] has held that there are only two limitations imposed under Rule 7 of the Rules, for distribution of credit by a Input Service Distributor. Firstly, it cannot exceed the amount of service tax paid and secondly, the credit of service tax attributable to service used shall not be distributed in a unit exclusively engaged in the manufacture of exempted goods or providing of exempted services. The manufactur ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ore. (ii) Whether CESTAT was right in not taking into cognizance the facts brought out in the Order-In-Original that M/s ILTD is not an office or establishment of the said manufacturer i.e., M/s ITC Ltd Bangalore and hence credit distributed by M/s ILTD as well as availed by M/s ITC were irregular? (iii) Whether the provisions of Rule 2(m) of Cenvat Credit Rules, 2004 have been satisfied for distribution of credit by ILTD and subsequently whether such credit could be availed by M/s ITC? 2. Facts leading to filing of this appeal briefly stated are that the Indian Leaf Tobacco Division (ILTD) is a division of ITC Group of Companies and is involved in the activity of processing and supply of leaf tobacco. The assessee viz., th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he Customs Excise and Service Tax Appellate Tribunal. The tribunal by an order dated 12.07.2016 allowed the appeal preferred by the assessee. In the aforesaid factual background, this appeal has been filed. 5. Learned counsel for the appellant submitted that the tribunal ought to have appreciated that M/s ILTD is not eligible to be an Input Service Distributor as it is not an office or an establishment. In this connection, our attention has been invited to Rule 2(m) of Cenvat Credit Rules, 2004. It is also argued that ILTD is neither a manufacturer of excisable goods nor is a provider of output services. Therefore, the question of availing any input service by ILTD does not arise. 6. On the other hand, learned counsel for the assessee ha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ribution of service tax paid input credits to manufacturing activities carried on in the factories. A division bench of this court in COMMISSIONER OF C.EX., BANGALORE-I VS. ECOF INDUSTRIES PVT. LTD.,', 2011 (271) E.L.T. 58 (KAR.) has held that there are only two limitations imposed under Rule 7 of the Rules, for distribution of credit by a Input Service Distributor. Firstly, it cannot exceed the amount of service tax paid and secondly, the credit of service tax attributable to service used shall not be distributed in a unit exclusively engaged in the manufacture of exempted goods or providing of exempted services. The manufacturer is therefore, required to register himself as Input Service Distributor and thereafter, is entitled to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r 2010 to July 2011 and for a period from August 2011 to December 2011, the revenue cannot be permitted to challenge its correctness. Reference in this regard may be made to decisions of Supreme Court in 'CCE VS. BIGEN INDUSTRIES LIMITED', 2006 (197) ELT 305 (SC), 'BOVING FOIURESS LTD. VS. CCE', 2006 (202) ELT 389 (SC), 'MARSONS FAN INDUSTRIES VS. CCE', 2008 (225) ELT 334 (SC), 'INDIAN OIL CORPORATION VS. CCE', 2006 (202) ELT 37 (SC). The order passed by the tribunal does not suffer from any infirmity. For the aforementioned reasons, the substantial questions of law are answered against the revenue and in favor of the assessee. In the result, the appeal is dismissed. - - TaxTMI - TMITax - Cent ..... X X X X Extracts X X X X X X X X Extracts X X X X
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