service tax credit on commission service received

[manan pandya]

We are engaged in the manufacture of submersible pump set falling under Heading No. 84137010 of the First Schedule to the Central Excise Tariff Act, 1985. this is dutiable goods

for that We are paying commission to our commission agent in helping to get enquiry from clients, participating in tender for procuring sales order.

Please advise whether Service tax paid to commission agent on above activities fall under the definition of input service as laid down in the Rule 2(1) of CENVAT credit Rule 2004,

so can we take credit of input service for above commission service from commission agent and can utilized against excise duty ?

regards,

Manan Pandya

AI Summary

Conflicting Decisions on CENVAT Credit for Commission Agents: Key Differences in Sales Promotion vs. Commission Activities A manufacturing company inquired about the eligibility of claiming CENVAT credit on service tax paid to commission agents involved in sales activities. The responses highlighted conflicting court decisions: while some Tribunal decisions, supported by the Punjab and Haryana High Court, allowed such credits, the Gujarat High Court ruled otherwise in the Cadila Healthcare case. The distinction between sales promotion and commission activities was emphasized, with eligibility for credit depending on the accounting treatment of the commission. The discussion concluded that clarity in activity description and accounting is crucial to determine CENVAT credit eligibility.