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TMI Blog2023 (6) TMI 690X X X X Extracts X X X X X X X X Extracts X X X X ..... f the decision in ROCA BATHROOM PRODUCTS PVT. LTD. VERSUS C.C.C., JAIPUR [ 2016 (12) TMI 223 - CESTAT NEW DELHI] , relied upon by Learned Authorised Representative, serves to discard the claim. It is seen that the primary issue agitated before the Tribunal in that dispute was the jurisdictional competence of central excise authorities having control of the recipient of credit to raise demand for recovery under CENVAT Credit Rules, 2004 and the order impugned therein was upheld by discarding that claim without examining applicability of the retrospectivity issue decided in earlier orders of the Tribunal; this is not surprising as such a plea had not been made in that proceeding. From the records, it is seen that there is no allegation of the conditions prescribed having been breached in any manner in determination of distribution of credit by input service distributor which the head office was. The availment of the entirety of credit, so accrued, at the Peenya facility is not inconsistent with the law. The sole counter of Learned Authorised Representative to this ruling is a portion of the decision of the Tribunal in Roca Bathroom Products Pvt Ltd which is nothing more than ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ere without jurisdiction inasmuch as the credit under dispute was validly available to them under rule 7 of CENVAT Credit Rules, 2004. It was further contended that rule 14 of CENVAT Credit Rules, 2004 does not envisage recovery of such validly taken credit from the recipient of such distribution. Reliance was placed on the decision of the Tribunal in ECOF Industries Pvt Ltd vs. Commissioner of Central Excise, Bangalore [2010 (17) STR 515 (Tri-Bang)] which was affirmed by Hon ble High Court of Karnataka in Commissioner of Central Excise, Bangalore I vs. ECOF Industries Pvt Ltd [2011 (271) ELT 58 (Kar)] . A further submission that the impugned show cause notices had not raised the issue of deployment of impugned services for carrying out of exempted activity and impropriety of insinuation thereof was sought to be buttressed by relying upon the decision of the Hon ble High Court of Karnataka in Commissioner of Central Excise, Bangalore IV vs. ITC Ltd [2021 (50) GSTL 339 (Kar)] holding that non-contest of eligibility, as decided in appeal, precluded raising the issue once again in another proceedings. That trading was specifically deemed to be exempted activity only w ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the decision in Roca Bathroom Products Pvt Ltd, relied upon by Learned Authorised Representative, serves to discard the claim. It is seen that the primary issue agitated before the Tribunal in that dispute was the jurisdictional competence of central excise authorities having control of the recipient of credit to raise demand for recovery under CENVAT Credit Rules, 2004 and the order impugned therein was upheld by discarding that claim without examining applicability of the retrospectivity issue decided in earlier orders of the Tribunal; this is not surprising as such a plea had not been made in that proceeding. 6. In ECOF Industries Pvt Ltd, it was held by the Hon ble High Court of Karnataka that 9. In fact, the Board has issued a circular clarifying in this regard, which is extracted by the tribunal at para 7 which reads as under :- Para 7. Para 2.3 of the Master Circular referred to by the ld. Advocate reads as under :- 2.3 An Input service distributor is an office or establishment of a manufacturer of excisable goods or provider of taxable service. It receives tax paid invoices/bills of input services procured (on which Cenvat credits can be taken) and d ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t credits can be taken) and distributes such credits to its units providing taxable services or manufacturing excisable goods. The distribution of credit is subject to the conditions that, - (a) the credit distributed against an eligible document shall not exceed the amount of service tax paid thereon, and (b) credit of service tax attributable to services used in a unit either exclusively manufacturing exempted goods or exclusively providing exempted services shall not be distributed. An input service distributor is required (under Section 69 of the Act, read with Notification No. 26/2005-S.T.) to take a separate registration. 8. The combined reading of the Rule 7 and the clarificatory Circular dated 23-8-2007 clearly shows that there are only two restrictions regarding the distribution of the credit. The first restriction is that the credit should not exceed the amount of Service Tax paid. The second restriction is that the credit should not be attributable to services used in manufacture of exempted goods or providing of exempted services. There are no other restrictions under the rules. The restrictions sought to be applied by the Department in this case in limiting the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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