TMI Blog2024 (11) TMI 345X X X X Extracts X X X X X X X X Extracts X X X X ..... agreed to be at the rate of two percent of the net invoice value and the payment was agreed to be remitted in US$ to the Bank Account of the appellant only after the full payment from the customer is received. These clauses have also been observed by the original adjudicating authority of the Order-in-Original. Despite observing these paragraphs we do not find any reasonable explanation in the said order to deny the arrangement between the appellant and the agent and the purpose for appointing him for the sales promotion activity. No reason to sustain those findings. It is held that appellant has rightly availed the Cenvat Credit on the amount of commission paid to its sales agent. The allegations in the Show Cause Notice of suppression are therefore held to be redundant based whereupon the Department has invoked the extended period of limitation while issuing the Show Cause Notice. For the said reason the Show Cause Notice itself is held to be barred by time. - DR. RACHNA GUPTA, MEMBER (JUDICIAL) Present for the Appellant : Mr. Ankit Totuka, Advocate Present for the Respondent : Mr. Rohit Issar, Authorised Representative ORDER Present appeal has been filed to assail the order-i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rt this Tribunal has been following the said decisions, wherein the commission paid for the sales promotion activity is held eligible for the availment of Cenvat credit. Ld. Counsel has impressed upon that the availment is thus wrongly been denied. It is also mentioned that there is no element of any suppression or misrepresentation, hence the extended period has wrongly been invoked while issuing the impugned Show Cause Notice. The confirmation of demand proposed by the said Show Cause Noticed by the order under challenge is therefore not sustainable. Order is accordingly prayed to be set aside and the appeal is prayed to be allowed. 4. While rebutting these submissions, ld. D.R. has mentioned that the appellant had never produced any document to the investigation agency to show that the amount of commission as paid by the appellant under reverse charge mechanism is an amount paid towards the sales promotion activity. The agreement as relied upon by the appellant was for the first time produced before the Original Adjudicating Authority. The agreement is of the year 2008, otherwise also the obligations of the agent as recited in the said agreement are sufficient to show that the a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ution of a works contract and construction services including service listed under clause (b) of section 66E of the Finance Act (hereinafter referred as specified services) insofar as they are used for- (a) construction or execution of works contract of a building or a civil structure or a part thereof; or (b) laying of foundation or making of structures for support of capital goods, except for the provision of one or more of the specified services; or (B) [services provided by way of renting of a motor vehicle), insofar as they relate to a motor vehicle which is not a capital goods, or (BA) service of general insurance business, servicing, repair and maintenance, insofar as they relate to a motor vehicle which is not a capital goods, except when used by- (a) a manufacturer of a motor vehicle in respect of a motor vehicle manufactured by such person; or (b) an insurance company in respect of a motor vehicle insured or reinsured by such person; or] C) such as those provided in relation to outdoor catering, beauty ( treatment, health services, cosmetic and plastic surgery, membership of a club, health and fitness centre, life insurance, health insurance and travel benefits extended t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... possibilities etc. the agent obligation was to procure the sale orders to take care about possible damage to the appellants seller. Clause 4 of the agreement reveals that the commission was agreed to be at the rate of two percent of the net invoice value and the payment was agreed to be remitted in US$ to the Bank Account of the appellant only after the full payment from the customer is received. These clauses have also been observed by the original adjudicating authority in para 13.2 of the Order-in-Original. 9. Despite observing these paragraphs I do not find any reasonable explanation in the said order to deny the arrangement between the appellant and the agent and the purpose for appointing him for the sales promotion activity. I do not find any reason to sustain those findings. Further, it is observed that this issue though has the contradictory decisions and is subjudiced before Hon ble Apex Court. But this Tribunal is constantly following the decision of jurisdictional High Court (Hon ble High Court of Punjab Haryana). The decision in the case of Orient Retractories has already observed as follows:- 3. After hearing both the parties and perusing the case law as relied upon ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rms that there is no bar on availment of the Cenvat credit on sales promotion service by way of sale of dutiable goods on commission basis. Further, by inserting the Explanation in the Rule 2(l), it has confirmed the Board Circular and resolved the different views of the High Courts. Taking into circumstances under which the Explanation was inserted in Rule 2(l) of Rules, 2004 and consequence of the Explanation to extend the benefit to the assessee as per Board Circular, we hold that the Explanation inserted in Rule 2(l) of Rules, 2004 by Notification No. 2/2016-CX (N.T.) (supra) should be declaratory in nature and effective retrospectively. 11. The above discussion clarifies that the issue is no more res-integra. It is held that appellant has rightly availed the Cenvat Credit on the amount of commission paid to its sales agent. The allegations in the Show Cause Notice of suppression are therefore held to be redundant based whereupon the Department has invoked the extended period of limitation while issuing the Show Cause Notice. For the said reason the Show Cause Notice itself is held to be barred by time. 12. With these observations and findings, I hereby set aside the impugned O ..... X X X X Extracts X X X X X X X X Extracts X X X X
|