TaxTMI 
TaxTMI 
2021 (7) TMI 296
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....med by the Adjudicating Authority against Krishna Food has been upheld with interest and penalty. The appeals filed by M/s. Parle Biscuits Pvt. Ltd. [Parle Biscuits] and Ms. Mariamma R. Iyer [Iyer] against the imposition of penalty have also been dismissed. 2. Krishna Food is the appellant in Excise Appeal No. 52692 of 2019. It claims to be a contract manufacturing unit engaged in manufacturing biscuits for its principal Parle Biscuits, which is the appellant in Excise Appeal No. 52694 of 2019. Iyer is Vice President of Parle Biscuits and has filed Excise Appeal No. 52693 of 2019. 3. Krishna Food claims that it was authorised by Parle Biscuits to manufacture, on its behalf, "biscuits" and to comply on its behalf all the procedural formali....
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.... not only in the factories of Parle Biscuits, but also in the factories of other contract manufacturers, it was thought, as a business strategy, that advertisement, market research, sales promotion and marketing should be centralised and handled by the office of Parle Biscuits at Bahadurgarh. Such credit on input services attributable to the final product was distributed by Parle Biscuits on a pro-rata basis proportionate to the turnover of each unit between its own manufacturing plants and its contract manufacturing units, including Krishna Food, under rule 7(d) of the CENVAT Rules. 7. A show cause notice dated July 18, 2018 was, however, issued to Krishna Food and Parle Biscuits to show cause as to why the CENVAT credit of service tax di....
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....ors' invoice by Parle to its contract manufacturing unit is legal and correct when the contract manufacturing is carried out in terms of notification No. 36/2001-CE (NT). (ii) Irrespective of the position that whether issuance of Input Service Distributors' invoice by Parle to Krishna is correct or otherwise, whether Krishna still is entitled for cenvat credit when the input service is attributed to the goods on which excise duty is paid includes the cost of services on which credit was taken." 10. The Larger Bench of the Tribunal by order dated 25.05.2021 answered the reference in the following manner: 44. The answer to the first issue referred to by the Division Bench would, therefore, be that Parle was justified in distributing cred....