2023 (9) TMI 643 - CESTAT MUMBAI

Recovery of CENVAT Credit from Input Service Distributor (ISD) against credits disputed by it to its manufacturing units - HELD THAT:- Going by the judgments of KANSAI NEROLAC PAINTS LTD. VERSUS COMMISSIONER OF GST, MUMBAI [2018 (5) TMI 673 - CESTAT MUMBAI], and INDIAN OIL CORPORATION LTD. VERSUS COMMISSIONER OF C. EX., DELHI-II [2014 (10) TMI 729 - CESTAT NEW DELHI] there can’t be any second opinion that Rule 14 of the CENVAT Credit Rules, 2004 can only be made applicable against the manufacturer/service provider or the person who availed the allegedly inadmissible credit and show-cause notice can’t be issued against the Input Service Distributor for recovery of CENVAT Credit. Board Circular dated 10.03.2014 re-affirmed the same position and clarified further that show-cause notice can’t be issued against ISD under Rule 14 of the CENVAT Credit Rules, 2004.

The entire demand raised against the Input Service Distributor is not sustainable in law - Appeal allowed.