TMI Blog2014 (7) TMI 750X X X X Extracts X X X X X X X X Extracts X X X X ..... credit is not admissible, what is the methodology that should be adopted for quantification of ineligible input service tax attributable to trading activities - Held that:- categorically that prior to 01/04/2011 trading cannot be considered as an exempted service. In the said decision, it was held categorically that apportionment of input service tax credit on common input services used for trading activity and manufacturing activity could be done based on the ratio of their respective turnover. In view of this decision, we are of the considered view that the demand for reversal of input service tax credit in the present case adopting the ratio of the turnover of trading activity and manufacturing activity, in the impugned order, cannot be ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Service Distributor (ISD) with the department. Therefore, without putting the ISD to notice, the impugned demand could not have been confirmed. It is his contention that if there is a wrong distribution of credit, it is the ISD who is responsible for paying back the wrongly distributed credit and not the appellant who has actually availed the credit. In this regard, he relies on the decision of this Tribunal in the case of CST Ahmedabad Vs. Godfrey Philips India Pvt.Ltd. and United Phosphorous Ltd. Vs. CCE, Surat-II - 2013(30) STR 509 (Tri-Ahmed). 2.1 His next contention is that with effect from 01/04/2011 trading has been deemed as an exempted service and this deeming is by way of an explanation and the explanation states that it is ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n that in respect of services specified under the Rule 6 (S), full credit can be taken on the common input services used in the manufacture of dutiable goods and exempted services. Accordingly, he pleads for grant of stay. 3. The learned Additional Commissioner (AR) appearing for the Revenue on the other hand submits that as far as the jurisdiction of the adjudicating authority is concerned, the matter has been clarified by the Board vide letter No.137/68/2013-ST dated 10/03/2014 wherein it has been categorically stated that since the recovery of wrongly taken credit is under Rule 14 of the Cenvat Credit Rules, 2004, it is the jurisdictional excise authorities, (who are in charge of the unit which has taken credit) who are the competent ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ules, 2004 makes this position absolutely clear. As per the said rules, Where the CENVAT credit has been taken or utilized wrongly or has been erroneously refunded, the same along with interest shall be recovered from the manufacturer or the provider of the output service and the provisions of sections 11A and 11AB of the Excise Act or sections 73 and 75 of the Finance Act, shall apply mutatis mutandis for effecting such recoveries. 4.2 In the present case, it is the appellant manufacturer who has taken the credit and therefore, the recovery of wrongly taken credit has to be effected from him. The distribution of service tax through ISD is only a facility provided under the Rules and does not deal with recovery. Therefore, the credit, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... at apportionment of input service tax credit on common input services used for trading activity and manufacturing activity could be done based on the ratio of their respective turnover. In view of this decision, we are of the considered view that the demand for reversal of input service tax credit in the present case adopting the ratio of the turnover of trading activity and manufacturing activity, in the impugned order, cannot be faulted. 4.4 As regards the reliance placed on the Delhi High Court's decision ordering pre-deposit of 50% of the demand, we asked the Consultant for the appellant as to whether the appellant is pleading any financial hardship. The learned Consultant for the appellant clearly stated that they are not taking ..... X X X X Extracts X X X X X X X X Extracts X X X X
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