TMI Blog2014 (6) TMI 385X X X X Extracts X X X X X X X X Extracts X X X X ..... ioned after the words ‘such as’ following this expression and that the activities covered by this expression must be similar to the activities which are mentioned as illustrative activities and on this basis, Hon’ble High Court has given a finding that procuring sales orders through commission agents is not an activity, which is similar to the activities mentioned as illustration of the ‘activities relating to business’. Rule 2 (l) of Cenvat Credit Rules, 2004 was amended w.e.f. 1.4.2011 and by this amendment, the expression ‘activities related to business’ in the inclusive portion of the definition of ‘input service’ was excluded. However, the expression ‘advertisement or sales promotion’ was retained. The Board vide Circular No.943/4/2011-CX dated 29.4.2011 (S.No.5 of the Table) in respect of the question ‘Is the credit of Business Auxiliary Service (BAS) on account of sales commission now disallowed after the deletion of expression ‘activities related to business’ clarified as under The definition of ‘input service’ allows all credit on services used for clearance of final products upto the place of removal. Moreover, activity of sale promotion is specifically allowed and on ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dispute, the definition of the inclusive part of the definition of input service as given in Rule 2 (l) of the Cenvat Credit Rules covered the sales promotion and also the activities related to business , that the Tribunal in a series of judgements has held that the activity of procuring of sales orders by the commission agent is an activity of sales promotion or an activity relating to business and would be admissible for cenvat credit, that in this regard, he relies upon the Final Order No.A/827-828/2012-EX (BR) dated 10.07.2012 of the Tribunal in the appellant s own case, the judgements of the Tribunal in the case of Lanco Industries Ltd. Vs. CCE, Tirupati reported in 2010 (17) STR 350 (Tribunal-Bang.) and also in the case of Bajaj Hindustan Ltd. Vs. CCE, Lucknow reported in 2013 (30) STR 675 (Tribunal-Delhi) , that the Hon ble Punjab Haryana High Court in the case of CCE, Ludhiana Vs. Ambika Overseas reported in 2012 (25) STR 348 (P H) has upheld the Tribunals order permitting cenvat credit in respect of commission agent services and that in view of this, the impugned order denying cenvat credit is not sustainable. 4. Shri P.K. Sharma, ld. Departmental Representativ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ness of the manufacture of final product, the service would not quality to be a input service under Rule 2(1) of the 2004 Rules. He emphasized that procurement of sales orders is an integral part of the manufacturing business and hence, this has to be treated as input service . 6. I have considered the submissions from both the sides and perused the records. 7. The only point of dispute in this case is as to whether the service of procuring sales orders of cement through commission agents i.e. business auxiliary services being received by them is covered by definition of input service or not. On this issue, while there is a direct judgement of Hon ble Punjab Harayana High Court in the case of Ambika Overseas (supra), which is in favour of the appellant, there is another judgement of the Hon ble Gujarat High Court in the case of Cadila Health Care Ltd. (supra), wherein in para 5.2, a contrary view has been taken and in that judgement, Hon ble Gujarat High Court after discussing in detail, has held that the service of commission agent for procuring sales orders is neither covered by the expression sales promotion nor by the expression activities relating to business . H ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... anufacturing the final product. 28. The expression activities in relation to business in the definition of input service postulates activities which are integrally connected with the business of the assessee. If the activity is not integrally connected with the business of the manufacture of final product, the service would not qualify to be a input service under Rule 2 (1) of the 2004 Rules. 7.2 Thus in para 28 and 29 of the above judgement, Hon ble Bombay High Court has in clear terms held that the expression activities relating to business in the definition of input service in Rule 2 (l) covers all the activities which are integrally connected with the business of the manufacture of final product and only an activity which is not connected with the business of manufacture of final products would not qualify as the input service under Rule 2 (l). In para-28 of this judgement, Hon ble Bombay High Court has emphasized that the definition of input service is very wide and covers not only services, which are directly or indirectly used in or in relation to the manufacture of final products, but also includes various services used in relation to the business of manu ..... 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