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2015 (8) TMI 956 - AT - Service TaxDenial of CENVAT Credit - Credit on sales commission - Invocation of extended period of limitation - Held that:- Gujarat High Court in the case of Cadila Healthcare Ltd (2013 (1) TMI 304 - GUJARAT HIGH COURT), after considering the decision of Hon’ble Punjab & Haryana High Court [2011 (7) TMI 980 - PUNJAB & HARYANA HIGH COURT], held that CENVAT Credit on overseas commission would not be admissible and hence, the denial of CENVAT Credit on merit is sustainable. Vide Boards Circular No.943/4/2011-CX, dt.29.04.2011, it was clarified that the definition of input service allows all credit on services used for clearance of final product upto the place of removal. Moreover, the activity of sales promotion is specifically allowed and on many occasions, the remuneration for same is linked to actual sale. Reading the provision harmoniously, it is clarified that the credit is admissible on the services of sale of dutiable goods on commission basis. The Hon’ble Gujarat High Court in the case of Cadila Healthcare Ltd (supra) differed with the view of Hon’ble Punjab & Haryana High Court in the case of Ambika Overseas (supra). It is also noted that the Tribunal in various decisions during the material period held that the CENVAT Credit is available on overseas sales commission. - there is sufficient material to take up the view that the Appellant was holding a bonafide belief of the admissibility of CENVAT credit on overseas sales commission. We have also noticed that the Appellant has taken the credit and duly recorded in the CENVAT account. Thus, there is no material available to invoke the extended period of limitation. Accordingly, the demand of CENVAT Credit alongwith interest and penalty for the extended period cannot be sustained. Denial of CENVAT Credit alongwith interest and penalty is set aside, as barred by limitation - Decided partly in favour of assessee.
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