TaxTMI 
TaxTMI 
2014 (8) TMI 654
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....ity by different adjudication orders denied the cenvat credit along with interest and penalty. By the impugned orders, Commissioner (Appeals) rejected the appeals filed by the appellants and upheld the adjudication orders. 3. Learned Consultant on behalf of the appellant submits that Unit-I paid the amount of advertisement charges and duly recoded in their books of accounts which is related to their Unit-II. He submits that the definition of "input services" under 2(l) of the Cenvat Credit Rules does not envisage its use in the factory of production of final product. He further submits that the adjudicating authority clearly observed that the Unit-II is entitled to avail the credit. Thus there is no reason to deny the credit to Unit-I as both the units are under a common manufacturer. He strongly relied upon the following decisions of the Tribunal in the case of (a) Ecof Industries Pvt. Ltd. Vs CCE Bangalore - 2009 (10) LCX 0078 [para-8] which was upheld by the Hon'ble Karnataka High Court in the case of CCE Bangalore Vs Ecof Industries Pvt.Ltd. - 2011 (271) ELT 58 (Kar.) [Para-10] (b) CCE ....
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....ion to the manufacture of the final product of IC Engine. But, the input service credit availed by Unit-I on advertisement of diesel engine manufactured at Unit-II is in no way related to the goods manufactured by Unit-I. It is also observed that in terms of Rule 2(m) of the Rules 2004, "Input Service Distributor" means an office of the manufacturer, which received invoices issued under Rule 4A of the Service Tax Rules, 1994 towards purchase of input services and issued invoice, bill or as the case may be challan for the purpose of distributing the credit of service tax paid on the said service to such manufacturer or producer or provider, as the case may be. It is contended that invoices issued under Rule 4A of Service Tax Rules, 1944 towards purchase of input services have to be distributed to the credit of the said services to such manufacturers only. The Ld. A.R relied upon various decisions wherein it has been held that the activity must have nexus with business of assessee qualify as "input service". 7. In the present case, M/s.Greaves Cotton Ltd. is engaged in the manufacture of IC Engine and Diesel Engine through their Unit-I and Unit-II respectively. There is no dispute t....
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....LT 58 (Kar.) held as under :- "10. Therefore, these are the only two limitations, which are imposed in Rule 7 preventing the manufacturer from utilizing the CENVAT credit, otherwise, he is entitled to the said credit. Merely because the input service tax is paid at a particular unit and the benefit is sought to be availed at another unit, the same is not prohibited under law. It is in this context, the manufacturer is expected to register himself as a input service distributor and thereafter, he is entitled to distribution of credit of such input in the manner prescribed under law. Therefore, the order passed by the tribunal is legal and valid and does not suffer from any legal infirmity and does not call for any interference and therefore it is dismissed." 9. In the case of Doshion Ltd. (supra), the Tribunal observed that there being no restriction for utilization of cenvat credit of input service without allocating proportionately to various units during the relevant period, the omission to take registration as input service distributor can at best be considered as procedural irregularity. In that case, th....
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....es 2004. The Tribunal held that credit should not be denied for such procedural infraction when substantial part of the rule is complied. The another aspect of this case is that Unit-I, appellant herein, is eligible to avail the credit on service tax paid on advertisement charges. The reason for denial of the credit is that the contents of the advertisement is in respect of product of other unit. It is contended by the appellant that the advertisement charges incurred by the appellant had been added to the cost. The Hon'ble Bombay High Court in the case of M/s.Cocacola India Pvt. Ltd. (supra) allowed the credit of service tax paid on advertisement. In that case, the appellant manufactured non-alcoholic beverage bases known as "concentrates". These 'concentrates' sold under respective brand names such as Coca Cola, Fanta etc. The concentrate was sold by the appellant to bottling companies who, in turn, sold aerated beverages from the concentrates to distributors who, in turn, sold to retailers for the ultimate sale to the consumer. The advertisement and sales promotion activities including market research was undertaken by the appellant. Revenue denied the credit on the ....