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2019 (8) TMI 1838 - AT - Central ExciseCENVAT Credit - input services or not - services rendered by the commission agents/stockists - credit denied on the ground that the services rendered by Consignment Stockist is not related to ‘sales promotion’ as required in the said Credit Rules - Suppression of facts or not - time limitation - HELD THAT:- It is found that apart from effecting mere sale of goods, the concerned agents are also mandated to undertake sales promotion related activities. It is specifically stated in the agreement that the Consignment Stockist will foster and promote sale, inform the appellant about demand prospects, distribution and sale of appellant’s goods, arranging warehouse facility etc. It is clear that the responsibility assigned to the said Stockist is not restricted only to sale of product but also to undertake sales promotion activities. The issue relating to eligibility of credit on commission agent services is no longer res-integra inasmuch as this Tribunal in Essar Steel India Ltd. [2016 (4) TMI 232 - CESTAT AHMEDABAD], as also relied by the appellant, has held that the above amendment would be applicable retrospectively and would cover cases for the past period also. The co-ordinate Bench of this Tribunal at Ahmedabad held that In the present case, the expressions in the explanation as inserted by Notification No. 2/2016-C.E. (supra), make it clear that it is for explaining the meaning of clause “sales promotion” in the context of Rule 2(l) of the Rules, 2004. It is to provide an additional support to the dominant object of the word “sales promotion” in Rule 2(l) in order to make it meaningful and purposeful. The language of the explanation is consistent with Board Circular to the benefit of the assessee and it would be effective retrospectively. Time Limitation - malafide intent or not - HELD THAT:- It is not in dispute that the availment of credit was duly disclosed in ER-1 returns. The observations made by the Ld. Commissioner that the nature of credit availed was not disclosed by appellant in the return is not correct for the reason that in the absence of any column in the return requiring the assessee to disclose the nature of input service, the same cannot be construed to mean that there is a malafide intention on the part of the appellant - in absence of suppression on the part of the appellant, the impugned SCN dated 04.11.2016 issued by invoking extended period of limitation is not sustainable. The appeal filed by the assessee succeeds both on merits as well as on limitation.
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