Appeal granted for tour packages as dealer's commission, allowing Cenvat credit on service tax.

The Tribunal allowed the appeal in favor of the appellant, holding that the tour packages provided to dealers could be considered as a form of dealer's commission, making the Cenvat credit on service tax paid admissible. The decision set aside the previous orders that disallowed the credit, concluding that the appellant was entitled to avail the credit.

---

---

Issues: Admissibility of Cenvat credit on service tax paid for tour packages provided to dealers.

Analysis:
1. Issue of Admissibility of Cenvat Credit: The appellant, engaged in manufacturing, availed Cenvat credit of service tax paid on tour packages provided to their dealers. Revenue contended that the tour packages were not related to sales promotion, making the Cenvat credit inadmissible. The Original Adjudicating Authority upheld the demand and imposed a penalty, a decision affirmed by the learned Commissioner (Appeals). The appellant challenged this before the Tribunal.

2. Interpretation of Precedents: The appellant cited the case of M/s Simbhaoli Sugar Ltd. vs. Commissioner of Central Excise, Meerut, while arguing that the ruling of the Hon'ble Gujarat High Court in the case of Gujarat State Fertilizers & Chemicals Ltd. was not applicable as it pertained to sales agents, which were not involved in the present case.

3. Tribunal's Analysis: The Tribunal examined the submissions from both parties and reviewed the precedents cited. It noted that the Gujarat High Court's ruling focused on the appointment of agents as stockists, unlike the situation where tour packages were arranged for dealers. Referring to the M/s Simbhaoli Sugar Ltd. case, the Tribunal emphasized that if commission is paid to sales commission agents for selling manufactured goods, the service tax on such commission is eligible for input service credit. In this case, the Tribunal found that the tour packages could be considered as a form of dealer's commission, making the Cenvat credit on service tax paid admissible.

4. Conclusion: Consequently, the Tribunal set aside the impugned order and allowed the appeal in favor of the appellant. The decision was pronounced in open court on 9th December 2019 by Hon'ble Mr. Anil G. Shakkwar, Member (Technical) of the Appellate Tribunal CESTAT Allahabad.

---