TMI Blog2018 (7) TMI 97X X X X Extracts X X X X X X X X Extracts X X X X ..... complied retrospectively - appeal dismissed - decided against Revenue. - Service Tax Appeal No. 51179 of 2018 (SM) - Final Order No. 52380/2018 - Dated:- 2-7-2018 - Hon ble Shri Ajay Sharma, Member ( Judicial ) Shri K. Poddar, Authorized Representative ( DR ) for the appellant Shri Mohit Gohlyan, C.A. for the respondent ORDER Per. Ajay Sharma The instant appeal has been filed from the order-in-appeal dated 16/01/2018. 2. The respondent/assessee is engaged in providing the construction of residential complex services, real estate agent services and business support services . During the course of audit of records of the respondent/assessee it was observed that the assessee had availed Cenvat credit of service tax paid on commission/brokerage on sale of flats amounting to ₹ 40,56,453/- during the period from July 2013 to September 2015. Accordingly, a show cause notice was issued to the respondent/assessee as to why :- (i) Cenvat credit of service tax amounting to ₹ 40,56,453/- should not be recovered from them under Rule 14 of the Cenvat Credit Rules, 2004 readwith proviso to Section 73 (1) of the Finance Act, 1994 ; (ii) Inte ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... -CE (ST) dated 03/02/2016 which are necessary for the purposes of determining of the issue involved in the instant appeal are extracted as under :- Rule 2 (l) input service means any service, - (i) used by a provider of [output service] for providing an output service; or (ii) used by a manufacturer, whether directly or indirectly, in or in relation to the manufacture of final products and clearance of final products upto the place of removal, and includes services used in relation to modernisation, renovation or repairs of a factory, premises of provider of output service or an office relating to such factory or premises, advertisement or sales promotion, market research, storage upto the place of removal, procurement of inputs, accounting, auditing, financing, recruitment and quality control, coaching and training, computer networking, credit rating, share registry, security, business exhibition, legal services, inward transportation of inputs or capital goods and outward transportation upto the place of removal ; XXX XXX XXX Cenvat Credit Rules, 2004 - Second Amendment of 2016 In exercise of the powers conferred by section 3 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s been extracted as under :- 20. But, the Hon ble Gujarat High Court in the case of Cadila Healthcare Ltd. (supra) was unable to concur with the contrary view taken by the Hon ble Punjab Haryana High Court in the case of Commissioner of Central Excise, Ludhiana v. Ambika Overseas (supra). The Hon ble Gujarat High Court held that this issue is concerned, the question is answered in favour of the Revenue and against the assessee. In this background, legislature explained the meaning of the sales promotion by inserting Explanation in Rule 2(l) of Rules, 2004 and declared that sales promotion includes services by way of sale of dutiable goods on commission basis. In other way, Explanation to Rule 2(l) of Rules says in clear terms that there is no bar on availment of the Cenvat credit on sales promotion service by way of sale of dutiable goods on commission basis. Further, by inserting the Explanation in the Rule 2(l), it has confirmed the Board Circular and resolved the different views of the High Courts. Taking into circumstances under which the Explanation was inserted in Rule 2(l) of Rules, 2004 and consequence of the Explanation to extend the benefit to the assessee as per B ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ana High Court in the case of Commissioner of Central Excise, Ludhiana v. Ambika Overseas (supra). The Hon ble Gujarat High Court held that this issue is concerned, the question is answered in favour of the Revenue and against the assessee. In this background, legislature explained the meaning of the sales promotion by inserting Explanation in Rule 2(l) of Rules, 2004 and declared that sales promotion includes services by way of sale of dutiable goods on commission basis. In other way, Explanation to Rule 2(l) of Rules says in clear terms that there is no bar on availment of the Cenvat credit on sales promotion service by way of sale of dutiable goods on commission basis. Further, by inserting the Explanation in the Rule 2(l), it has confirmed the Board Circular and resolved the different views of the High Courts. Taking into circumstances under which the Explanation was inserted in Rule 2(l) of Rules, 2004 and consequence of the Explanation to extend the benefit to the assessee as per Board Circular, we hold that the Explanation inserted in Rule 2(l) of Rules, 2004 by Notification No. 2/2016-CX (N.T.) (supra) should be declaratory in nature and effective retrospectively . 5. ..... X X X X Extracts X X X X X X X X Extracts X X X X
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