Tribunal allows appeal for refund claim on input service credits after appellant's valid name change post-merger.

The Tribunal allowed the appeal, setting aside the impugned order that rejected the appellant's refund claim for distributed input service credits. The Tribunal held that the appellant's name change following a merger was valid, and the reversal of input credit and subsequent refund claim were justified based on the applicable Cenvat Credit Rules and relevant case laws. The Tribunal rejected the Revenue's arguments of limitation and unjust enrichment, emphasizing that the grounds were not raised timely and that the credit could be redistributed to another unit.

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Issues Involved:
1. Change of appellant's name due to merger.
2. Rejection of refund claim by the Deputy Commissioner and upheld by the Commissioner (Appeals).
3. Distribution of input service credit by input service distributor.
4. Reversal of input credit and subsequent refund claim.
5. Applicability of Cenvat Credit Rules and relevant case laws.
6. Grounds of limitation and unjust enrichment raised by the Revenue.

Detailed Analysis:

Issue 1: Change of Appellant's Name Due to Merger
The appellant filed a miscellaneous application to change their name from Wyeth Limited to Pfizer Limited following a merger approved by the Hon’ble Bombay High Court on 31.10.2014. The application was allowed, and the name in the cause title of the appeal was amended accordingly.

Issue 2: Rejection of Refund Claim
The appeal was directed against the Order-in-Appeal No. YDB/24/LTU/MUM/2012 dated 28.02.2012, which upheld the Deputy Commissioner’s order rejecting the refund claim. The appellant, a unit of Wyeth Ltd., had distributed input service credits amounting to Rs. 18,89,971/- for advertisement services.

Issue 3: Distribution of Input Service Credit
During an audit, it was observed that the distributed credit pertained to services not related to the goods manufactured by the appellant. Consequently, the appellant was asked to reverse the credit, which they did under protest.

Issue 4: Reversal of Input Credit and Subsequent Refund Claim
The appellant reversed the credit by making a debit entry under protest and later filed a refund claim in 2010, citing the ECOF Industries Pvt. Ltd. case. The refund claim was rejected by the Deputy Commissioner and subsequently by the Commissioner (Appeals), leading to the present appeal.

Issue 5: Applicability of Cenvat Credit Rules and Relevant Case Laws
The appellant argued that during the relevant period, the Cenvat Credit Rules did not require the input service distributor to distribute credit only to the unit related to the service. This condition was introduced in 2012, whereas their case pertained to 2017. The appellant cited the ECOF Industries Pvt. Ltd. case, upheld by the Karnataka High Court, and followed by the Tribunal in Nestle India Ltd., to support their claim.

The Tribunal examined Rule 7 of the Cenvat Credit Rules, 2004, which outlined the conditions for distributing CENVAT credit. The rule was amended in 2012, but for the period in question, only two restrictions existed: the credit should not exceed the service tax paid, and it should not be attributable to services used in a unit exclusively manufacturing exempted goods or providing exempted services.

Issue 6: Grounds of Limitation and Unjust Enrichment Raised by the Revenue
The Revenue argued that the refund claim was time-barred and needed to be examined for unjust enrichment. However, the Tribunal noted that these grounds were not raised by the original authority. Section 11B of the Central Excise Act, 1944, provides that the limitation of one year does not apply if the duty and interest were paid under protest.

The Tribunal also observed that if credit is denied in one unit, it should be redistributed to another unit. As the credit was admissible either to the unit or its sister concern, the argument on unjust enrichment was not valid.

Conclusion:
The Tribunal found no merit in the impugned order and set it aside, allowing the appeal. The order was pronounced in the open court.

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