TaxTMI 
TaxTMI 
2015 (3) TMI 1186
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....rnataka in the case of Commissioner of Central Excise, Bangalore-I Vs ECOF Industries Pvt. Ltd. reported in 2011 (23) S.T.R. 337 (Kar.), it is further submitted that transfer of credit by ISD from one unit to another is genuine. Therefore, there cannot be denial of credit on the ground that the input services were not used to provide any output service or manufacture of any excisable goods. 2. Revenue supports the order of the authorities below. 3. Heard both sides and perused the records. 4. The basic principle of Cenvat credit being to avoid cascading effect, genuine credit earned by one unit is not disallowed for set off against liability of other in absence of any prohibition thereto by law. This can be appreciated from the rat....
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....ter distribute the same to its various units except to two conditions which are mentioned in Rule 7. Therefore, he submits that there is no reason for interfering with the order passed by the tribunal, which is strictly in accordance with law. 5. In the light of the aforesaid facts and rival contentions, the question that arises for consideration is that when service tax is paid in respect of services obtained by a unit at Cuttack whether such a credit of the said service tax paid cannot be utilized by a unit at Malur belonging to the same manufacturer, namely the assessee. 6. As we are concerned only about input service, it is sufficient to extract the definition of input, input service and input service distributor, whic....
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....les promotion, market research storage upto the place of removal procurement of inputs, activities relating to business, such as accounting, auditing, financing, recruitment and quality control, coaching and training, computer networking, credit rating, share registry, and security, inward transportation of inputs or capital goods and outward transportation upto the place of removal; 2(m) "input service distributor" means as office of the manufacturer or producer of final products or provider of output service, which receives invoices issued under rule 4A of the Service Tax Rules, 1994 towards purchases of input services and issues invoice, bill or, as the case may be, challan for the purposes of distributing the credit of service ....
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....e 7. Manner of distribution of credit by input service distributor. - The input service distributor may distribute the CENVAT credit in respect of the service tax paid on the input service to its manufacturing units or units providing output service, subject to the following conditions, namely :- (a) the credit distributed against a document referred to in rule 9 does not exceed the amount of service tax paid thereon, or (b) credit of service tax attributable to service use in a unit exclusively engaged in manufacture of exempted goods or providing of exempted services shall not be distributed." Therefore, only two limitations are put for the distribution of credit by an input service distributor. Firstly, it cann....