TaxTMI 
TaxTMI 
2023 (1) TMI 186
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....di and Rudrapur were clearing goods under area based exemption Notification No. 50/2003-CE dated 10.06.2003 whereas the other units of the Appellants, including the units in impugned appeals, were clearing goods on payment of Central Excise Duty at the applicable rate. The Appellants also have a corporate head office at Kaushumbi, Ghaziabad which were registered with the Central Excise & Service Tax department as Input Service Distributors (ISD in short) for distributing the Cenvat Credit of input services received at the corporate office in relation to the goods manufactured at various unit across India. Baddi Unit and Rudrapur Units of M/s. Dabur India Limited were availing area based exemption under Notification No. 50/2003-C.E., dated 10-6-2003. It appeared to Revenue that credit of Service Tax attributable to service used in a Unit exclusively engaged in the manufacture of exempted goods was distributed by Input Service distributor, to Units which were manufacturing dutiable goods. It appeared to Revenue that under Clause (b) of Rule 7 of the Cenvat Credit Rules, 2004 M/s. Dabur India Limited (Corporate head office) was not entitled to distribute such Input Service Tax credit ....
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.... 3.2 He further submits that for the same Units (Silvassa) for the subsequent period from April 2011 to December 2011, the appeals filed by Appellants against the denial of Cenvat Credit availed on distributed by ISD office on advertisement and sale promotion services were decided by the this CESTAT vide Order reported at 2018(2) TMI 618-CESTAT- Ahmedabad in favour of appellants. The Hon'ble Tribunal has settled the issue in the Appellant's favour vide the above mentioned decisions and therefore, on this ground alone the present demands confirmed against the Appellant's units are also liable to be set aside. 3.3 Without prejudice, he also submits that Appellant are entitled to avail CENVAT credit distributed to it by the ISD. The Rule 7 as applicable during the period in dispute it contained only two conditions for distribution of Credit by ISD and dispute is only restricted to applicability of condition as contained in Rule 7(b) of Credit Rules. Moreover, the word used in this Rule are "used in a unit" which means if the services were used exclusively in that unit in manufacture of the exempted goods or providing of the exempted output services, the same shall not be distrib....
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....so placed reliance on the following decisions:- • 2016(42) STR 28(TRI-BANG) -FOSROC CHEMICALS INDIA PVT. LTD. VS. CST, BANGALORE -LTU • 2018(17) GSTL 422 (DEL) - LALLY AUTOMOBILES P. LTD. VS. COMMISSIONER (ADJUDICATION), C.EX. • 2019(24)GSTLJ 115(SC) -LALLY AUTOMOBILES PVT. LTD. VS. COMMISSIONER • 2008 (10) STR 382 (TRI- MUM)- METRO SHOES P. LTD. VS. CCE, MUMBAI. • 2010 (19) STR 205 (TRI. AHMD) - ORION APPLIANCES LTD. VS. CST, AHMEDABAD. 05. After hearing both the side and on perusal of available records, we find that an identical issue in the assessee-appellant's own case has been decided in favour by the Tribunal. The said orders of Tribunal are reproduced below:- • DABUR INDIA LIMITED- 2017 (6) GSTL 106 (Tri.-All.) "4. Heard the ld. Counsel for appellant who has taken us through the said show cause notice in Paras 14 & 15. He also taken us through the provisions of Rule 7 of the Cenvat Credit Rules, 2004 that were operational during the material period of show cause notice. He has contended that as per Clause (b) of Rule 7 of the Cenvat Credit Rules, 2004 Service Tax attributable to service....
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....l Corporation Ltd. v. Commissioner of Central Excise, Delhi-II reported at 2014 (35) S.T.R. 411 (Tri. - Delhi) wherein it was held that demand for recovery cannot be raised against input service distributor under Rule 14 of the Cenvat Credit Rules, 2004. 5. Heard the ld. DR who has relied on theimpugned Order-in-Original. The ld. DR has contended that provisions of Clause (d) of Rule 7 of the Cenvat Credit Rules, 2004 were clarificatory in nature and they were applicable to the period even before 1-7-2012. 6. Having considered the rival contentions and on perusal of the records, we find that the Original Authority has specifically relied on provisions of Clause (d) of Rule 7 of the Cenvat Credit Rules, 2004 for confirmation of demand whereas no such provision has been invoked in the said show cause notice because during the material period such provisions did not exist on statute. We further find that in Paras 14 & 15 of the said show cause notice a methodology was adopted for distribution of Cenvat credit into admissible and inadmissible credit on the basis of turnover. We do not find any provision of law for doing so. We further find that Clause (b) of Rule 7 of....
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....oods. It is admitted that the Services such as Advertisement Service & Sales Promotion Services, were utilized in Corporate Office, Kaushambi, Ghaziabad. The Id. Counsel also contended that both the Show Cause Notices are hit by limitation. He has also contended that the second Show Cause Notice is repetition of the first Show Cause Notice. We keep the issue of limitation open. We set aside both impugned Order-in-Original and allow both appeals. The appellants shall be entitled for consequential relief, if any, as per law." Similarly, in the case of M/s Secure Meters Limited Vs CCE & ST, Jaipur, the Tribunal vide Final Order No.52089-52090/2017 dated 03.03.2017 has allowed the appeal of the assessee- Appellants by observing that: "8. In view of the above fact, in terms of Rule 6(5) of Cenvat Credit Rules, the full Cenvat credit will be available to the assessee, if such services were used in a manufacturing unit making both, the exempted as well as dutiable goods. In the present case, the full Cenvat credit has been availed by the ISD who is required to distribute the same to various units as per Rule 7 of Cenvat Credit Rules. The Rule 7 (as it stood at the releva....
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....vailed inadmissible credit to the extent of input services attributable to their exempted units, show cause notice was issued for recovery of the amount of 32,43,619/- (in Appeal No.E/12638/2014) and 7,35,611/- (in Appeal No.E/12637/2014) with interest and proposal for penalty. On adjudication the demand was confirmed with interest and penalty. Aggrieved by the said order the Appellant filed Appeal before the ld. Commissioner (Appeals), who in turn, rejected their Appeals. Hence, the present Appeals. 2. The ld Advocate for the Appellants submits that the credit availed by the Appellants in their Silvassa Unit had been denied alleging that the procedure laid down under Rule 7(b) of CENVAT Credit Rules, 2004 has not been followed, hence, the credit availed by them is erroneous. It is his contention that in the case of other units situated under the jurisdiction of Allahabad and Delhi Tribunal had been decided in their favour. In support, he refers to the judgment of the Tribunal in their own case reported as 2017-TIOL-1978 - CESTAT - ALL and 2017-TIOL-3082-CESTAT - DEL. 3. The ld. A.R. for the Revenue reiterates the findings of the Id. Commissioner (Appeals). ....