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2023 (3) TMI 575 - AT - Service TaxCENVAT Credit - services provided by the Commission Agent - appellant submits that the Services of the Commission Agent is not in relation to either sale of their product or for providing any sales promotion services - HELD THAT:- Hon’ble Gujarat High Court in the case of COMMISSIONER OF CENTRAL EXCISE, AHMEDABAD – II VERSUS M/S CADILA HEALTH CARE LTD. [2013 (1) TMI 304 - GUJARAT HIGH COURT] has held that the commission agent merely acts as an agent of the principal for sale of goods and such sales are directly made by the commission agent to the consumer - it can be observed that the issue before the Hon’ble High Court was in respect of sale of goods, promotion of sale of goods, etc. by the Commission Agent The Hon’ble High Court held as Commission Agent in this case is only selling the goods and not undertaking any Sales Promotion work, the Respondent would not be eligible for the Cenvat Credit. Further it would be relevant to note here that an amendment was brought in w.e.f. 3.2.2016 to allow Cenvat Credit on ‘Sales Promotion’ also, so as to overcome the difficulty faced by the assesses in view of Gujrat High Court Decision. In the present case, the Commission Agent is not rendering any service towards sale/Sales Promotion of the present Appellant. The Commission Agent is only an Agent engaged in collection of debts from various subscribers. Therefore, the very premise to issue Show Cause Notice basing on the decision of the Hon’ble Gujarat High Court is erroneous on the part of Department. The Hon’ble Gujarat High Court judgment is on an entirely different type of Commission Agent and is not applicable to the facts of present case. The Hyderabad Tribunal in the case of PEPSICO INDIA HOLDINGS (PVT.) LTD. VERSUS COMMISSIONER OF CENTRAL TAX, TIRUPATI [2021 (7) TMI 1094 - CESTAT HYDERABAD] has held that Services used in setting up the factory are, therefore, unambiguously covered as ‘input services’ under Rule 2(l)(ii) of the Cenvat Credit Rules, 2004 as they stood during the relevant period (post 1-4-2011). The mere fact that it is again not mentioned in the inclusive part of the definition makes no difference. Once it is covered in the main part of the definition of input service, unless it is specifically excluded under the exclusion part of the definition, the appellant is entitled to Cenvat credit on the input services used. Extended period of limitation - HELD THAT:- The fact of taking Cenvat Credit on Commission Agent Service is regularly reported in the periodical STReturns filed by the Appellant. Further, the issue of Cenvat Credit on Commission Agent Service is a matter of interpretation and the Department was in error in equating Collection Agent’s service in the present case with that of the service provided by the Commission Agent towards sale of goods/sales promotion in the Cadilla Case [[2013 (1) TMI 304 - GUJARAT HIGH COURT]]. Therefore, the allegation of suppression with an intent to evade cannot be sustained. Hence, the proceedings are hit by limitation and the confirmed demand for the extended period is set aside. Appeal allowed - decided in favor of appellant.
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