2026 (4) TMI 1226

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.... Credit Rules, 2004 in respect of both Input Service Distributors (ISD) as well as manufacturer of goods have given raise to these two appeals, in which both orders are assailed by the Appellant ISD as well as the manufacturer. Legality of invocation of extended period in confirming equal penalty alongwith interest on both is also questioned in these two appeals. 2. Learned Counsel for the Appellants Mr. C.S. Biradar submitted that Rule 14 recovery notice can only be sent to the manufacturer and not to the ISD unit as has been settled through several decisions, including those reported in 2014 (35) STR 411 (Tri. - Del.) in the case of Indian Oil Corporation Ltd. Vs. Commissioner of Central Excise, Delhi-II and reported in MANU/CM/0260/20....

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....cenario is contrary to the law. 3. Learned Authorised Representative Mr. Ranjan Kumar objects to such submissions. He mainly placed his reliance on the decision of this Tribunal passed in the case of Clariant Chemicals (i) Ltd. Vs. Commissioner of Central Excise, Raigad, as reported in 2015-TIOL- 2510-CESTAT-MUM, in which at para 5 there was a clear findings that it was unnecessary to bifurcate ISD office and manufacturing unit as two different distinct legal entities as both are integrally connected and both of them are required to resolve the issue with the Department. He also argued that Audit Officer are equally empowered to issue show-cause notices on the Assessee for recovery of tax dues but failed to produce any circular authorisi....

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....t Mahindra & Mahindra Ltd. decision was primarily based on the decision of Indian Oil Corporation Ltd. that was decided on 11.03.2014 giving a clear finding that demand for recovery can't be raised against Input Service Provider under Rule 14 of the CENVAT Credit Rules, 2004, which is also in conformity to the Board's Clarificatory Circular letter dated 10.03.2014 but the ratio of this judgment was not taken into consideration while deciding Clariant Chemicals (I) Ltd., apparently for the reason that it was not argued before the Bench. Apart from the above distinction, it is also to be placed on record that neither the Board Circular nor provision of Rule 14 of CENVAT Credit Rules, 2004 were taken into consideration in making an observation....