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TMI Blog2024 (11) TMI 201X X X X Extracts X X X X X X X X Extracts X X X X ..... buted by their Head Office situated at Thane (Mumbai). 2. During the course of the audit by the department of the financial records of the appellant's head quarters at Than, it has been noticed by the department that their head quarter office has distributed the input service credit amounts to three units located at :- i. Ankleshwar, Dist. Bharuch, (Gujarat Plant) ii. Semmankuppan (Tamil Nadu plant) iii. Surajpur, Guatam Budha Nagar (Uttar Pradesh plant) 3. The Department is of view that since the appellants Head Office is who providing output service, the Head Office of the appellant has not proportioned input credit going for providing output service at cleared and therefore distribute the input service credit amounts three uni ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... wance of credit in the hands of the appellant which was distributed by their Head Quarter at Thane as Input service distributor is correct or otherwise. 4.3 We find that exactly the same issue in case of Appellant's Tiruchirapalli unit has been decided by the Chennai Bench vide Final Order No 40021/2023 dated 31.03.2023 [2023-TIOL112-CESTAT-MAD], observing as follows 7.1 The lower authorities have pressed into service Rules 3 and 7 of the CCR, 2004 to disallow and recover the CENVAT Credit availed by the recipientappellant unit, but however, when the audit took place at the Head Office unit, which is the ISD unit, nothing is placed on record as to whether any Show Cause Notice was issued to the said unit which chose to distribute (to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... :- 5. We find that the services on which Cenvat credit has been availed are being used for providing output services is not in dispute. If at all Pune unit of the appellant distributes this credit to various other units on pro rata basis Cenvat credit was available to the other units also and it is also not in dispute that during the period the other units were also discharging service tax liability in cash also. Therefore, the entire exercise would have been revenue neutral. Hence we hold that rejecting the claim of Cenvat credit of the appellant is unsustainable and liable to be set aside and we do so." The Hon'ble Bombay High Court, thereafter, vide its judgement against the above order of CESTAT Mumbai [2019 (366) E.L.T. 624 (Bom. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n. But in any case that alone is not sufficient since the Department has to prove that there is a revenue loss to the exchequer. The above arguments would remain so because the Department was aware of both sides of the coin, that is to say, they came to know of input service distribution by the ISD unit in the particular manner when they conducted audit there. This means that they are aware of the distribution of input credit in the particular manner. When this is the situation, then there is no question of suppression, much less of any receipt of the input credit by the appellant. 11. In view of the above discussions, I am of the clear view that the disallowance of CENVAT Credit in the hands of the recipient-appellant, as confirmed in t ..... X X X X Extracts X X X X X X X X Extracts X X X X
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