2010 (12) TMI 650

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....t under Section 11AC of the Central Excise Act. The period of dispute is September 2005 to December 2008. This application filed by the appellants seek waiver of pre-deposit of these dues and stay of recovery thereof. 2. Appellants are engaged in the manufacture of hydraulic excavators falling under Chapter 84 of the Central Excise Tariff. The appellants had entered into a sole selling agreement with M/s. Larson & Toubro Ltd., (L&T) appointing L&T as the exclusive agent to market various products manufactured by it. On receipt of intelligence by the departmental officers that the appellants irregularly availed credit of service tax paid by it on the commission paid to L&T., the Commissioner of Central Excise, Bangalore-III issued a sh....

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....on and the service tax in question. It is submitted that the Commissioner had wrongly found suppression against the appellants and invoked larger period. The demand was barred by limitation. The demand of service tax and interest as also the order of penalty was not sustainable. 4. In the appeal filed before us, inter alia, the following grounds have been taken. "(g)  The Division Bench of the Bombay High Court in the Coco Cola India Pvt. Ltd. v. CCE, 2009 (15) S.T.R. 657 (Bom.) = 2009 (242) E.L.T. 168 (Bom.) was pleased to hold that activities in relation to business, cover all activities that are related to the functioning of the business and the expression relating to further widens the scope of the expression activity relati....

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....ncluded activities like identification of prospective customers, taking and forwarding orders from the customers, collection of payment from the customers etc. He found that these services did not have connection with the manufacture of final products of the assessee and therefore did not constitute input services. The activity involved was neither advertisement nor sales promotion; the same was not therefore covered under the inclusive part of the definition of input service as claimed by the assessee. Therefore, he found that the impugned credit was not admissible. 7. We find that the assessee engaged services of L&T for marketing its products. L&T identifies prospective customers for the products of the assessee, engages in negotia....