2018 (1) TMI 1009

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....nt. They availed the facility of CENVAT credit of inputs, capital goods and input services. On scrutiny of ER-1 of March 2006, it was noticed that the appellants have taken credit of service tax on sales commission paid to M/s. Agnes Bruno Limited, Calcutta for securing Rs. 123.5 crores design, engineering, manufacture and supply contract order for plant and machinery to M/s. Binani Cement Ltd. On verification of records, it was found that the appellants had manufactured and supplied excisable goods only to the tune of Rs. 8,26,73,721/- to M/s. Binani Cement Ltd. The remaining part of materials valued to the tune of Rs. 111,51,44,499/- which were supplied by the appellant to M/s. Binani Cement Ltd. were not goods manufactured by appellant, ....

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....s relating to business is eligible for credit. The services of sales promotion were consumed in relation to business and therefore qualifies for credit. Further, the word includes used in the definition of input services enlarges the scope of the definition. The Commissioner has travelled beyond the scope of the definition making his own presumption that services consumed in relation to manufacture alone qualifies for credit without even looking into the inclusive part of the definition. The Commissioner failed to appreciate that once the expenses are incurred in connection with business activities, the services fall within definition of service and the tax paid is eligible for credit. Merely because the bought-out goods were also used for ....

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....ed and the order passed is legal and proper. 4. Heard both sides. 5. The main ground of argument put forward by the ld. counsel is that the input services of BAS upon which the appellant paid the sales commission and availed credit of service tax paid need not have any direct nexus with the manufacture of final products. It is thus submitted by him that though appellant has availed credit on the service tax paid on the commission for procuring the work order and even though bought-out items were supplied to the customer, it would not make the input services ineligible for credit. We do not find any merit in this contention. The appellant has mainly advanced his arguments stating that the sales promotion services being qualified as inp....