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2019 (11) TMI 232 - AT - Central ExciseCENVAT credit - input services - Sales Promotion Service / Customer Care Services - period from November 2010 to May 2015 and June 2015 and June 2017 - extended period of limitation - HELD THAT:- Thus period involved is after 1.4.2011 as well as prior to this date. For the period prior to 1.4.2011 the definition of ‘input services’ included the words “activities relating to the business” and therefore the services availed by the appellant would undoubtedly be eligible for credit prior to 1.4.2011. Ld. counsel has explained the segregation of the amounts with different units of the appellant. There are six units of the appellant and the amount shown for services mentioned in the agreement is for all the six units. Thus the appellant unit has to pay ₹ 3 lakhs as per the agreement for the entire services provided. The adjudicating authority has apportioned the whole amount of ₹ 3 lakhs towards customer care services without any basis and thereafter rejected the credit. It is indeed the allegation stated in the SCN that appellant has availed credit of service tax paid on sales promotion and customer care services. Then findings of the adjudicating authority that the entire amount is for customer care services cannot sustain. The manufacturer has to maintain the customer sales / help line / cell for redressing the customer’s grievances. Indeed, the manufacturer being liable for the manufacturing defect of the product, the activity is in relation to manufacture. Such customer care services help in augmenting the sales and therefore is closely related with the sales promotion also. The finding of the authorities below that customer care service does not have direct nexus with the final products, in my view is legally incorrect. Extended period of limitation - HELD THAT:- The department has not been able to establish any positive act of suppression on the part of the assessee. The audit that culminated in issuance of the SCN in 2015 took place in2012. Further, department did not raise any objection in earlier audits for the availment of credit in respect of these input services - the invocation of extended period cannot sustain. The credit availed in respect of sales promotion service / customer care services are legal and proper - appeal allowed - decided in favor of appellant.
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