TMI Blog2017 (7) TMI 984X X X X Extracts X X X X X X X X Extracts X X X X ..... ior to 1.4.2011 - The appellant has explained in reply to SCN that being an exporter appellant has to find source of foreign buyers for which they have to engage foreign agents to whom the commission is paid. As a 100% EOU it is required to achieve positive net foreign exchange for which they have to ensure constant foreign market for their products - denial of credit is unjustified - appeal allowed - decided in favor of appellant. - Appeal No. E/544/2009, Appeal No. E/191/2010 - FINAL ORDER No. 41276-41277 / 2017 - Dated:- 24-7-2017 - Ms. SulekhaBeevi C.S. Member (Judicial) And Shri Madhu Mohan Damodhar, Member (Technical) Shri S. Muthuvenkatraman, Advocate For the Appellant Shri A. Cletus, ADC (AR) For the Respondent ORD ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... filed by the department setting aside the sanction of refund to the appellant. Aggrieved by such order, the appellant has filed appeal No.191/2010. Both these appeals were disposed by the Tribunal earlier by Final Order No.73-74/2011 dt.13.1.2011. The Tribunal then relied upon the judgement rendered by Tribunal in the case of CCE, Jallandhar vs Ambika Overseas - 2010 (20) STR 514 and Cadila Healthcare Ltd vs CCE, Ahmedabad - 2010 (17) STR 134 where the credit of service tax paid on foreign commission agent services was held to be eligible input service being sales promotion. The department filed appeal against this order before the Hon ble High Court. Meanwhile, the judgement rendered by Tribunal in Ambika Overseas (supra) was upheld by th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e dispute relates to the period prior to 01.04.2011 when the definition of input services had a wide ambit as it included all activities relating to the business. It is also argued by him that when the department has accepted the service tax paid by appellant under reverse charge mechanism on the commission paid to the foreign agent, the very same department cannot deny the credit availed by the appellant. The Tribunal vide earlier final order dt. 13.1.2011 had allowed the credit/refund relying upon two judgements of Tribunal. Against this, department filed appeal before Hon'ble High Court of Madras as C.M.A.No.3065 and 3066/2011. During pendency of the CMA, out of these two decisions, the Hon ble High Court of Gujarat in the case of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ns made by both sides. 5. We take note of the arguments put forward by the ld. counsel for the appellant with regard to remand of the matter by the Hon'ble High Court of Madras. Indeed, at the time of remand, out of the two judgements relied by the Tribunal in its earlier Final Order dt. 13.1.2011, only one judgment pertaining to Cadila Healthcare has been reversed by Gujarat High Court. However, the very same High Court in the case of Nilkamal Crates Bins (supra) vide judgement reported in 2015 (38) STR J363 (Guj.) has upheld the decision of the Tribunal holding the issue in favour of assessee. The issue in that case was whether assessee is entitled to take credit of the service tax paid under Business Auxiliary Service on commiss ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... placed specifying the fashion/design/specification. The manufacture of such goods without such specification may not find any market after clearance. The appellant has explained in reply to SCN that being an exporter appellant has to find source of foreign buyers for which they have to engage foreign agents to whom the commission is paid. As a 100% EOU it is required to achieve positive net foreign exchange for which they have to ensure constant foreign market for their products. Therefore the contention of the department that the activity of sales promotion rendered by the foreign agent is a post-manufacturing service and therefore not eligible for credit is not tenable. We hold that the denial of credit is unjustified. The impugned order ..... X X X X Extracts X X X X X X X X Extracts X X X X
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