2017 (12) TMI 384

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....erent services availed at various branches/depots and business units. The credit of services which were exclusively used at such business units cannot be distributed in terms of Rule 7 of the Cenvat Credit Rules, which prescribes the manner of distribution of credit by input service distributor. He argued that sub-rule (c) of Rule 7 stipulates that "credit of service tax attributable to service used wholly in a unit shall be distributed only to that unit". He argued that the 19 services in respect of which the credit has been taken were utilized at various branches/depots/business units and in terms of Rule 7 (c). Credit of services exclusively used there cannot be transferred. 2.1 Ld. AR relied on the decision of the Tribunal in the cas....

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....ise, the entire situation is Revenue neutral. 4. I have gone through the rival submissions. I find that the Commissioner (Appeals) has dropped the demand on two counts: (i) The appellants are availing and transferring the credit of 19 different services on the basis of turnover and no objection with respect to such transfer has been raised by the Revenue and therefore, no objection in respect of renting of immovable property service and telephone service can be raised. The services of renting of immovable property and telephone are exclusively used by individual units and therefore, credit of the same cannot be transferred to Rule 7 (b) of the Cenvat Credit Rules, 2004. (ii) The entire excise is revenue neutral as the revenue ha....

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....e commonly used for more than one unit) pro-rata on the basis of the turnover. 5.1 I find that the Commissioner (Appeals) has not given any reasoning as to why the provisions of Rule 7 (c) are not attracted. To that extent the order of the Commissioner (Appeal) is not a speaking order. The Commissioner (Appeals) has relied on the decision of the Tribunal in the case of Indeos Abs Ltd. - 2010 (254) EKT 628 (Guj). It is seen that the said decision does not grant permission to drop the demands in which involve an element of revenue neutrality. All it says is that no benefit would accrue if the matter is not decided. Revenue has argued that neutrality is to be adjudged not merely on the grounds that the credit is admissible but also on other....