Custom, Excise & Service Tax Tribunal
Alarsin vs Cce Mumbai I on 1 April, 2015
IN THE CUSTOMS, EXCISE AND SERVICE TAX APPELLATE TRIBUNAL, WEST ZONAL BENCH AT MUMBAI
COURT NO. II
APPEAL NO. E/85658, 85820/13 Mum
(Arising out of Order-in-Appeal No. BR(8)MI/2013 dated 7.01.2013 passed by the Commissioner of Central Excise (Appeals) Mumbai I)
For approval and signature:
Shri. M.V. Ravindran, Member (Judicial)
1. Whether Press Reporters may be allowed to see : No
the Order for publication as per Rule 27 of the
CESTAT (Procedure) Rules, 1982?
2. Whether it should be released under Rule 27 of the : No
CESTAT (Procedure) Rules, 1982 for publication
in any authoritative report or not?
3. Whether Their Lordships wish to see the fair copy : Seen
of the Order?
4. Whether Order is to be circulated to the Departmental : Yes
authorities?
Alarsin
:
Appellant
Versus
CCE Mumbai I
Respondent
Appearance Ms. Padmavati Patil, Advocate with Ms. Mani Prakash, Advocate for Appellants Shri N.N. Prabhudesai, Supdt. (A.R.) for Respondents CORAM:
Shri. M.V. Ravindran, Member (Judicial) Date of Hearing : 01.04.2015 Date of Decision : 01.04.2015 ORDER NO.
Per : M.V. Ravindran This appeal is directed against Order-in-Appeal No. BR(8)MI/2013 dated 7.01.2013.
2. Heard both sides and perused the records.
3. The issue involved in this case is regarding eligibility of CENVAT credit of service tax paid by a Marketing Agency. The appellant has two units one is at Udhna in Gujarat and one in Mumbai. Gujarat Marketing Agency has provided the services of Business Auxiliary Services for the products manufactured in Gujarat as well as in Mumbai. It is also undisputed that the goods were being manufactured and cleared from Udhana, Gujarat as well as Mumbai. It is the case of the Revenue that service tax paid on the services rendered for the marketing of the produced in Gujarat needs to be denied proportionately. Both the lower authorities recorded their findings that the appellant could not have utilized CENVAT credit at Mumbai for the products manufactured and cleared from Gujarat. The lower authorities have also held that marketing services are not interconnected with the manufacturing of the goods.
4. Learned Counsel would take me through the facts of the case and case law and submit that the issue is covered by the decision of the Division Bench in the case of Doshion Ltd. (288) ELT 291 (T).
5. Learned D.R. reiterated the findings recorded by the lower authorities and would rely upon the Tribunals decision in the case of Mangalore Refinery and Petrochemicals vs. CCE - 2013 (30) STR 475 and Market Creators Ltd. vs. CCE - 2014 (36) STR 386 (Tri. Ahmd.) and submit that as per the provisions of Rule 7 of Service Tax Rules 1994 the appellant should have registered and distributed the service tax credit availed as ISD.
6. On considering the submissions made by both sides and perusal of the records, I find that as to CENVAT Credit availed on the service tax paid by the service provider is not in dispute and the services were rendered to the appellant. The only dispute is that whether the service rendered by the service provider for the products manufactured in Gujarat and invoices raised can be availed as CENVAT Credit at Mumbai. I find that when there is no dispute as regards the services received by the appellant for the activity and service tax liability having been discharged by the service provider, omission to take registration as an Input Service Distributor is to be considered as procedure irregularity. The ratio of decision taken by the Bench in the case of Doshion Ltd. (supra) which is in para 5 is reproduced:-
We have considered the submissions made by both sides. We find considerable force in the arguments advanced by the learned counsel. The registered office and Vatva office both are located in the same place and appellant has simply utilized the credit at Vatva instead of distributing it to various units. As submitted by the learned counsel during the relevant period, there was no restriction for utilization of such credit without allocating proportionately to various units. The omission to take registration as an Input Service Distributor can at best be considered as procedural irregularity and in view of the decisions cited, has to be considered sympathetically.
7. I find that both the decisions in the cases of Mangalore Refinery and Petrochemicals (supra) Market Creators Ltd. (supra) relied on by learned A.R. have rendered by the Single Member Bench. The judicial discipline, Division Bench decision needs to be followed giving precedence over decision of Single Member Bench. Accordingly, the decision in the case of Doshion Ltd. (supra) of Division Bench is binding on me and following the same I find that the impugned order is liable to be set aside and I do so.
9. In view of the foregoing, the impugned order is set aside and the appeal is allowed.
(Dictated in Court) (M.V. Ravindran) Member (Judicial) nsk ??
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