TaxTMI 
TaxTMI 
2024 (3) TMI 751
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....Service Tax Department as Input Service Distributors (ISD) under Rule 7 of the Cenvat Credit Rules, 2004. The Head Office distributed the input service credit to the appellant on pro rata basis. 2.2 During the disputed period, the appellants were availing service tax credit on the basis of various ISD invoices issued by the Head Office being ISD. 2.3 For distribution of credit, ISD issued proper invoices in the name of the appellants and ISD invoices issued by the Head Office of the appellants are valid documents for availing cenvat credit in terms of Rule 9 of the Cenvat Credit Rules, 2004. 2.4 The present dispute is with regard to the period 2011-12 to 2017- 18 (Upto June, 2017). 2.5 During the period of dispute, the Revenue is of the view that the appellants have availed cenvat credit on the following input services, namely, (1) Man Power Supply, (2) Technical Inspection Service/Technical Testing Charges (3) Management Consultancy (4) Rental of Immovable Property (5) Maintenance and Repair Service (6) Business Auxiliary Service (7) Packing Charges Service (8) Consulting Engineering Service ....
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....t there is no dispute regarding payment of service tax by the assessee-Appellants before taking such cenvat credit." 2.11 In remand proceedings for the further period upto June, 2017, the matter was again adjudicated and the cenvat credit was denied. 2.12 Against the said order, the appellants are in appeals before us. 3. The ld.Counsel for the appellants submits that the ISD issued invoices in the name of Head Office and the Head Office distributed the cenvat credit to the units. It is his submission that the eligibility of input service i.e. where the input service is covered by the definition of "input service" is to be seen by ISD only and the appellant have no role as they are receiving invoices issued by ISD showing their proportionate cenvat credit eligible for cenvat credit issued by ISD. It is further submitted that the jurisdictional authority is only to say whether the documents on the basis that the appellant has taken the cenvat credit is correct or proper. The adjudicating authority has no jurisdiction and decide that the credit issued by ISD is incorrect and not eligible. Therefore, the observations of the adjudicating authority in the impugned order are bey....
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....ISD under Rule 7 of the Cenvat Credit Rules, 2004, or not ? 7. Admittedly, in this case, the appellants are having different manufacturing unit and their Head Office is located in Pune and and is registered as the Input Service Distributors (ISD). The Head Office distributed the input service credit to their manufacturing unit in proportionate of their clearance during the particular period. It cannot be said that on which service, the appellant has entitled to take the cenvat credit as the same cannot be available with the appellants. It is proper, the invoices issued by ISD is to be taken into consideration and one of the samples is extracted below : As the Head Office of the appellant is registered as ISD and distributed the cenvat credit in proportionate to the appellant i.e. 54.51% is valid documents to avail the cenvat credit in terms of Rule 9 of the Cenvat Credit Rules, 2004. If the Revenue wants to deny the availament of cenvat credit i.e to be only to the Head Office, who is registered as ISD. As no investigation has done at the end of the ISD for distributing ineligible cenvat credit to the appellant, the cenvat credit cannot be recovered from the appellants. 9.....
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....s which provides manner of distribution of Cenvat credit which is reproduced hereunder as : "Rule 7. Manner of distribution of credit by input service distributor. - The input service distributor may distribute the CENVAT credit in respect of the service tax paid on the input service to its manufacturing units or units providing output service, subject to the following conditions, namely : - (a) the credit distributed against a document referred to in rule 9 does not exceed the amount of service tax paid thereon, or (b) credit of service tax attributable to service used in a unit exclusively engaged in manufacture of exempted goods or providing of exempted services shall not be distributed." Therefore, only two limitations are put for the distribution of credit by an input service distributor. Firstly, it cannot exceed the amount of service tax paid and secondly, the credit of service tax attributable to service used shall not be distributed in a unit exclusively engaged in the manufacture of exempted goods or providing of exempted services." 6. There is no allegation against the appellant that the provisions of Rule 7 has been violated.....
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....ovider of output service which receives invoices issued under Rule 4A of the Service Tax Rules, 1994 towards purchases of input services and issues invoice, bill or, as the case may be, challan for the purposes of distributing the credit of service tax paid on the said services to such manufacturer or producer or provider, as the case may be. Therefore, the law mandates that the manufacturer who wants to avail the benefit of this service tax if he has more than one unit he should also get registered himself as a service provider and then, he would be able to collect all the input service tax paid in all its units and accumulate them at its head office and distribute the said credit to its various units. At the time of distribution, the manner of distribution is provided in Rule 7 which reads as under : - "Rule 7. Manner of distribution of credit by input service distributor. - The input service distributor may distribute the CENVAT credit in respect of the service tax paid on the input service to its manufacturing units or units providing output service, subject to the following conditions, namely :- (a) the credit distributed against a document referred to in rul....
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....unit at Malur. Therefore, the assessee was dealing with the very same product. Rule 7 of the Cenvat Credit Rules governs procedure/manner of distribution of credit by input service distributor by imposing two conditions therein, which are as follows : "a. Credit distributed under the invoice of ISD does not exceed the amount of Service Tax paid. b. Credit of service exclusively used for exempted goods or exempt service is not distributed." 5. Therefore, the assessee is entitled to distribute the Cenvat credit on the input services on its manufacturing unit or other units providing the output services. The view taken in the orderin- appeal that the distribution of credit is for the advertisement of the product, which is not at all manufactured at Malur unit, therefore, cannot be accepted. The finding recorded by the Appellate Authority that the assessee is entitled to take credit only in the unit where the product is manufactured, is therefore not the mandate of Rule 7 of the Cenvat Credit Rules. 6. Under these circumstances, we confirm the view taken by the Tribunal. We do not see any substantial question of law that arises for consideration in t....