TaxTMI 
TaxTMI 
2026 (2) TMI 1002
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....ributed by their head-office, as 'input service distributor (ISD)', between April 2007 to November 2011, after excluding tax of Rs. 13,37,34,363 on 'input service' that was not availed during the period on their own estimation of inadmissibility, to two units to the extent of 'input service' exclusively consumed by each and of common services not attributable exclusively to manufacture of exempted goods or for trading activities by either. The order [order-in-original no. Belapur/03-04/Taloja/R-I/COMMR/SFA/ 2015-16 dated 26th June 2015] of Commissioner of Central Excise & Customs, Belapur limiting the liability to Rs. 2,75,68,443, comprising of Rs. 2,43,51,720 being services utilized in common and Rs. 32,16,723 for lack of nexus between 'in....
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....erein to such credit, as was distributed under rule 7 therein, that is. The claim of the central excise authorities is that 'trading' - deemed to be 'exempted service' by insertion of Explanation in rule 2(e) of CENVAT Credit Rules, 2004 by notification dated 1st March 2011 - was never 'taxable' and that, notwithstanding its specific inclusion in the Rules from 1st April 2011 solely for clarification, the obligation to neutralise retention of credit by recourse to rule 6 of CENVAT Credit Rules, 2004 did always exist. 10. The adjudicating authority relied upon the decision of the Tribunal in Metro Shoes Pvt Ltd v. Commissioner of Central Excise, Mumbai -I [2008-TIOL-417-CESTST-MUM] which, being upon utilisation of credit of tax paid....
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....re always an 'exempted service', as is contended by the department. 19. To understand the scope of 'Explanation', it would be useful to refer to the decision of the Supreme Court in Sedco Forex. The Supreme Court clarified that if Explanation' widens the scope of the main provision, then it would be presumed to have only prospective effect, unless a contrary intention is expressed by the legislature. The same view was expressed by the Supreme Court in Martin Lottery. The Supreme Court, in effect, held that the use of the phrases, 'it is hereby declared' or 'removal of doubts', in itself will not enable a presumption to be drawn that the Explanation is retrospective. 20. The Tribunal in T....
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....t is further observed that the arguing counsels before the Hon'ble Madras High Court did not refer to or relied upon the judgment of Hon'ble Supreme Court in the case of Martin Lottery Agencies Ltd. (supra). Since, the law is well settled by the Hon'ble Apex Court in context with retrospective or prospective operation of the statute, the principles enunciated in the case of Martin Lottery Agencies Ltd. (supra) will be considered as the guiding factor for deciding the issue involved in the present case. 5.6 In view of the above discussions, we do not find any infirmity in the findings recorded in the impugned order, holding that amendment to Rule 2(e) by Notification No. 3/2011-C.E.(N.T.) dated 1-3-2011 will have the pro....