2020 (4) TMI 601

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....Service Tax- VII, Mumbai, since involved common issues, are taken up together for hearing and disposal. 2. Briefly stated the facts of the case are that the appellants are engaged in the manufacture of excisable goods at their factory at Thane. During the relevant period, i.e. 2011-12 and 2013-14 they have availed CENVAT Credit on the invoices issued by their Head Office being registered as an 'Input Service Distributors' (ISD). Alleging that the appellant also engaged in the activity of trading of goods and common input services have been used in the manufacture of excisable goods as well as in the trading activity, show-cause notices were issued during the relevant period to the appellant's Thane unit for recovery of 5%/6% of the profi....

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.... credit on the invoices issued by ISD. It is his contention that at best the Thane unit may be required to reverse proportionate CENVAT Credit availed on disputed input services availed at Head Office and allocated to Thane unit attributable to trading activity undertaken from their various depots/sales offices. 4. Learned AR for the Revenue reiterated the findings of the learned Commissioner. 5. We have carefully considered the submissions advanced by both sides and perused the records. The short issue involved in the present case for determination is whether Thane unit is required to reverse/pay 5/6% of the total trading turnover of the appellant under Rule 6(3)(i) of the CENVAT Credit Rules, 2004. It is not in dispute that the appe....

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....ver of Thane unit in the total turnover of the appellant. Therefore, demanding the entire amount of credit on trading activity from the Thane unit is without jurisdiction and unsustainable in law. It is their contention that at best the Thane unit can be asked to reverse proportionate credit availed by them on the trading activity relatable to invoices issued by their Head Office as an ISD. We find force in the contention of the appellant inasmuch as at their Thane unit, the appellant had taken credit on the basis of the ISD invoices issued by their Head Office which includes credit on common input services attributable to trading activity undertaken from their depots situated all over India; and also the credit availed on input services us....