Sales promotion commission as input service supports prima facie Cenvat credit and interim waiver of pre-deposit.

Sales promotion commission was treated as prima facie eligible as an input service under Rule 2(l) of the Cenvat Credit Rules, because such promotional activity is not confined to the factory premises and may necessarily take place outside it. On that prima facie view, the objection based on the absence of activity within the factory was rejected at the interim stage. The appellant was therefore granted waiver of pre-deposit and stay of recovery.

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Issues: Whether sales promotion commission claimed by the appellant qualified as input services for the purposes of Cenvat credit and, on that prima facie basis, justified waiver of pre-deposit and stay of recovery.

Analysis: The claim was examined with reference to the definition of input services under Rule 2(l) of the Cenvat Credit Rules. The objection that the sales promotion activity had not occurred within the factory premises was treated as unsustainable at the prima facie stage, since sales promotion and commission for such activity are not confined to the factory and may necessarily occur outside it. The appellant's reliance on the existing Tribunal view was accepted for the purpose of interim relief.

Conclusion: The commission for sales promotion was held to be prima facie eligible for consideration as input services, and the appellant was granted waiver of pre-deposit with stay of recovery.

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