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TMI Blog2018 (7) TMI 97X X X X Extracts X X X X X X X X Extracts X X X X ..... at the assessee had availed Cenvat credit of service tax paid on "commission/brokerage on sale of flats" amounting to Rs. 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 Rs. 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) Interest under Rule 14 of the Cenvat Credit Rules, 2004, readwith Section 75 of the Finance Act, 1994 should not be recovered from them on the above Cenvat Credit of Rs. 40,56,453/- and (iii) Penalty should not be imposed upon them under Rule 15 (2) of the Cenvat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ongwith interest. Consequently, imposition of penalties becomes void". 5. I have heard learned DR for the Department and learned Consultant for the respondent/assessee and perused the record. 6. The issue involved in the instant appeal is whether the commission paid to the sales/commission agents is related to promotion of any activity specified in the inclusive part of the definition of input service provided under Rule 2 (l) of the Cenvat Credit Rules, 2004. Rule 2 (l) of Cenvat Credit Rules as well as amendment carried out in the definition of input services under Rule 2 (l) vide Notification No. 2/2016-CE (ST) dated 03/02/2016 which are necessary for the purposes of determining of the issue involved in the instant appeal are extracted ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 04 (here-in-after referred to as the said rules), in rule 2, in clause (l), after sub-clause (C), the following Explanation shall be inserted, namely :- "Explanation. - For the purpose of this clause, sales promotion includes services by way of sale of dutiable goods on commission basis.". 3. In the said rules, in rule 3, in sub-rule (4), after the sixth proviso, the following proviso shall be inserted, namely :- "Provided also that the CENVAT credit of any duty specified in sub-rule (1) shall not be utilised for payment of the Swachh Bharat Cess leviable under sub-section (2) of section 119 of the Finance Act, 2015 (20 of 2015):". [Notification No. 2/2016-C.E. (N.T.), dated 3-2-2016]" 7. According to learned DR, the explanation in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 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 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s clarified that Cenvat credit is admissible on the services of the sale of the dutiable goods on commission basis. The said circular was endorsed by the Central Government vide Notification No. 2/2016-CE (NT) dated 03/02/2016. In the case of Cadila Healthcare Ltd. (supra), the Hon'ble Gujarat High Court had not referred to the Circular dated 29/04/2011 and also there were divergent views by the Hon'ble Punjab & Haryana High Court in the case of CCE, Ludhiana vs. Ambika Overseas - 2012 (25) S.T.R. 348 (P&H). Considering the conflict in judgments of different High Courts and also the notification dated 03/02/2016, this Tribunal in the case of Essar Steel India Ltd. (supra) has held that the said notification should be considered as declarato ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e settled position and law, we do not find any merits in the impugned orders. Accordingly, after setting aside the same, we allow the appeals in favour of the appellants". 11. Thereafter again this issue came up before this Tribunal in a batch of matters in which this Tribunal vide final order Nos. 51412-51426 of 2018 dated 16/04/2018 while following its decision in the matter of National Engineering Industries Ltd. (supra) dismissed the appeal filed by the Revenue. 12. Explanation to Rule 2 (l) of Rules 2004 says it in clear terms that there is no bar on availment of Cenvat credit on sales promotion service by way of sale of dutiable goods on commission basis. During the period from 2008 onwards this issue has been considered by various ..... X X X X Extracts X X X X X X X X Extracts X X X X
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