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2022 (8) TMI 825 - AT - Central ExciseDistribution of ITC - sales agents have charged service tax on commission so received by them - Department formed an opinion that since the (Consignment Sales Agents) CSAs were appointed for the sale promotion of chewing tobacco, the Cenvat has wrongly been distributed by the ISD to the appellants who were engaged in manufacturing Kiwam - Rule 7 C of Cenvat Credit rules - extended period of limitation - suppression of facts or not - HELD THAT:- Since Rule 7C has been amended w.e.f. 01.04.2016 and the period of impugned demand is till 30.06.2016 that the amended Rule 7C is not applicable to the present case. Hence the effect of word “shall” of the amended provision cannot be implemented upon the demand and period of demand in the present case. Since the appellant is observed to be dealing with the same product, though an ingredient thereof, as that being manufactured by ISD finally and for which the service in question was availed, hence even though the service precisely was not used in the appellant premises but in the different premises of the ISD Cenvat Credit cannot be denied by invoking rule 7 C of Cenvat Credit Rules - keeping in view the peculiar fact of the present case that the appellant herein was manufacturing an inseparable essential ingredient for the final product of the ISD that the input service of sales agent availed by the ISD for promotion of tobacco is held to have rightly been distributed to the appellant. The sole reliance of the adjudicating authority below, on Rule 7 C, the amendment thereof, is held to be absolutely wrong also for the reason that amendment came into effect after the period of demand in the present case was over. Extended period of limitation - Suppression of facts or not - HELD THAT:- The only ground taken by the adjudicating authority is that the documents in relation to availment of credit were not the part of those ERs is held not acceptable in the light of the fact that appellant had never committed any default or delay while filing the ER Returns. The returns contained all the requisite details as that of the invoice numbers, the amount of invoice, the amount of service tax etc. Nothing has stopped Department to look into those invoices - the allegation of suppression of facts against the appellant are without any basis. Accordingly the foremost reason for invoking the extended period of limitation remains not available with the Department. Otherwise also the onus is always upon the Department to prove the alleged misrepresentation or suppression of fact that too with an intent to evading duty. Admittedly, present is not the case of duty evasion. There is no evidence for any positive act on part of the appellant to prove the alleged misrepresentation or suppression of facts. For want of any evidence by the Department to prove the alleged suppression, fraud or collusion on part of the appellant to not to pay or to short pay the duty. It is held that Show Cause Notice should have been issued in the normal period of limitation. Since the SCN is issued after an expiry of period of more than 2 years same is held to be barred by time - Appeal allowed - decided in favor of appellant.
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