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TMI Blog2024 (3) TMI 751X X X X Extracts X X X X X X X X Extracts X X X X ..... ants. As the Head Office of the appellant is registered as ISD and distributed the cenvat credit in proportionate to the appellant i.e. 54.51% is valid documents to avail the cenvat credit in terms of Rule 9 of the Cenvat Credit Rules, 2004. If the Revenue wants to deny the availament of cenvat credit i.e to be only to the Head Office, who is registered as ISD. As no investigation has done at the end of the ISD for distributing ineligible cenvat credit to the appellant, the cenvat credit cannot be recovered from the appellants. As it has not been questioned that ISD has taken inadmissible cenvat credit, in that circumstances, the cenvat credit cannot be recovered from the appellants holding that the appellant has availed inadmissible cenvat credit. In fact, the appellant has availed cenvat credit on the invoices issued by ISD under Rule 7 of the Cenvat Credit Rules, 2004, which is eligible to avail the cenvat credit under Rule 9 of the Cenvat Credit Rules, 2004. There are no merit in the impugned orders and the same are set aside - appeal allowed. - HON BLE MR. ASHOK JINDAL , MEMBER ( JUDICIAL ) And HON BLE MR. K. ANPAZHAKAN , MEMBER ( TECHNICAL ) Shri Bhorat Raichandani , Advoca ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of manufacture by the appellant. 2.7 In these set of facts, various periodical show-cause notices were issued to the appellants to deny the cenvat credit on input service credit availed by the appellant on the strength of invoices issued by the input service distributor i.e. Head Office. 2.8 The appellants contested the show-cause notices, but the authorities below confirmed the demand against the appellants. 2.9 The matters were adjudicated and the demands were confirmed against the appellants by denying the cenvat credit on input service credit distributor by ISD. 2.10 Against the said order, the appellants filed the appeals before this Tribunal and this Tribunal vide Final Order No.FO/76667-76671/2017 dated 22.08.2017, remanded the matter back to the adjudicating authority for the period April, 2008 to August, 2014, observed as under: 5. After hearing both sides and on perusal of the material available on record, we are of the view that the impugned orders which have been passed without considering the earlier Orders-in-Original, are required to be set aside. Therefore, we remand the matter to the adjudicating authority with the direction to consider these orders and pass order ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 184 (Tri.-Del.) [ Rajender Kumar Associtates Vs. Commissioner of Service Tax, Delhi II ] (6) 2023 (72) GSTL 251 (Tri.-Del.) [ Delhi Metro Rail Corporation Limited Vs. Principal Commissioner, Service Tax, Delhi I] (7) 2017 (5) GSTL 294 (Tri.-Mumbai) [Nestle India Limited Vs. Commissioner of Customs Central Excise, Goa ] (8) 2015 (39) STR 861 (Tri.-Del) [ Balkrishna Industries Limited Vs. Commissioner of Central Excise, Jaipur ] 4. On the other hand, the ld.A.R. for the Revenue opposes the contention of the ld.Counsel for the appellants and submits that as alleged against the appellants that the services on which ISD distributed the input service credit to the appellants are not input services, therefore, the appellants are not entitled to take the cenvat credit and with regard to the distribution by ISD, the ld.A.R. for the Revenue relies on the decisions of this Tribunal in the case of Mahindra Mahindra Limited Vs. Commissioner of Service Tax, Mumbai reported in 2017 (7) TMI 167-CESTAT Mumbai and ACER India Private Limited Vs. Commissioner of Central Excise reported in 2023 (11) TMI 720 CESTAT Chennai. 5. Heard both sides and considered the submissions. 6. On going through the sub ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 10. Further, we find that all the services in question, on which the Head Office has availed cenvat credit and distributed to the appellants in proportionate in terms of Rule 7 of the Cenvat Credit Rules, 2004, the cenvat credit cannot be denied to the appellant as held by this Tribunal in the case of Balkrishna Industries Limited (supra), wherein this Tribunal has held as under : 4. From the facts, it emerges that appellant is having its office in Mumbai and as per definition of input services distributor as per Rule 2(m) which is reproduced herein as under : (m) input service distributor means 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, 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, as the case may be. 5. From the above provision, it is coming out that the inputs service distributor is the office of manufacturer or producer of final product. Therefore, it cannot be said that input ser ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... here are no other restrictions under the rules. The restrictions sought to be applied by the Department in this case in limiting the distribution of the Service Tax credit made in respect of the Malur Unit on the ground that the services were used in respect of the Cuttack Unit finds no mention in the relevant rules. As such, restricting the distribution of Service Tax credit in a manner as has been done by the impugned order of the lower appellate authority (original authority had approved of such distribution) cannot be upheld. In case the Department wants to place such restriction as is sought to be placed in the case, the rule is required to be amended. Said order was challenged by the Revenue before the Hon ble High Court of Karnataka as reported in [2011 (271) E.L.T. 58 (Kar.)] wherein the Hon ble High Court has observed as under : 8. It is in this context, the definition of input service distributor makes it clear that a manufacturer or a producer of a final product or a provider of output service may have more than one unit and may be distributed in various parts of the country. It is in this background the definition of service distributor is defined as office of the manuf ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e credit was disputed was not used in the factory of the appellant but it is related to the product Nescafe and Maggie Noodles which are manufactured in the appellant company s different factory. As regards the provision for distribution of the credit, there is no condition of one-to-one correlation between the credit distributed and the quantum of service received and used by a particular factory. Though the service is related to the product which is manufactured in the appellant s company in other factories. But all the factories belonging to one company and in the absence of any provision of one-to-one correlation the credit can be distributed to any factory of one company. This issue has been considered by the Hon ble Karnataka High Court in the case of Ecof Industries Pvt. Ltd. (supra) wherein it was held as under : 4. The assessee had availed the Service Tax credit based on the invoices issued by the Chennai office indicating that the Service Tax are taken by their unit at Malur. That the Service Tax paid by the Chennai unit pertains to advertisement of their product Sabena Dish Wash Bar which was manufactured by their Cuttack Unit and not by the unit at Malur. Therefore, the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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