Custom, Excise & Service Tax Tribunal
Commissioner, Central Excise & Service ... vs M/S Smita Conductors Ltd on 25 February, 2015
In The Customs, Excise & Service Tax Appellate Tribunal West Zonal Bench At Ahmedabad Appeal No.E/1006/2010; E/CROSS/174/2010 [Arising out of OIA No.KRS/83/Vapi/2010, dt.31.03.2010, passed by Commissioner of Central Excise & Customs (Appeals), Vapi] Commissioner, Central Excise & Service Tax, Vapi Appellant Vs M/s Smita Conductors Ltd. Respondent
Represented by:
For Appellant: Shri S.K. Shukla, A.R. For Respondent: Shri Vipul Khandhar, Chartered Accountant.
For approval and signature:
Honble Mr. P.K. Das, Member (Judicial)
1. Whether Press Reporters may be allowed to see the No Order for publication as per Rule 27 of the CESTAT (Procedure) Rules, 1982?
2. Whether it should be released under Rule 27 of the CESTAT (Procedure) Rules, 1982 for publication in any authoritative report or not?
3. Whether their Lordships wish to see the fair copy of Seen the order?
4. Whether order is to be circulated to the Departmental Yes authorities?
CORAM:
HONBLE MR. P.K. DAS, MEMBER (JUDICIAL) Date of Hearing/Decision:25.02.2015 Order No. A/10183 / 2015, dt.25.02.2015 Per: P.K. Das
1. Revenue filed this appeal against the order of Commissioner (Appeals), whereby the Adjudication order was set aside.
2. The learned Authorised Representative appearing for the Revenue submits that the Respondents are engaged in the manufacture of Conductors and availed credit of the input services on the strength of invoice which is issued in the name of head office and endorsed to the appellants unit. He submits that the appellants availed credit on the basis of invoice endorsed by Head office during the period April 2005 to September 2005 and the Head Office was not registered as Input Service Distributor under the CENVAT Credit Rules. It is his submission that the Respondents are not eligible to avail the CENVAT Credit on the basis of endorsed invoices of the Head Office which is not registered. He relied upon the following decisions:-
a) Mangalore Refinery & Petrochemicals Vs CCE Mangalore 2013 (30) STR 475 (Tri-Bang.)
b) Market Creators Ltd Vs CCE Vadodara 2014 (36) STR 386 (Tri-Ahmd)
3. On the other hand, learned Counsel on behalf of the Respondents submit that the same issue for the subsequent period, the Tribunal in their own case, the appeal filed by the Revenue as reported at 2012 (278) ELT 492 (Tri-Ahmd) (CCE Vs Samita Conductors Ltd). He further submits that the case laws relied upon by the learned Authorised Representative would not be applicable in the instant case. It is submitted that in the instant case, the Head Office was holding Central Excise registration under Business Auxiliary Service since April 2004. It is also submitted that after Boards circular No.97/8/2007-ST, dt.23.08.2007, their Head Office amended the registration certificate and incorporated the ISD in the registration certificate. He also submits that in this case, he relies upon the various decisions on the identical issue as under:-
a) Doshion Ltd Vs CCE Ahmedabad 2013 (288) ELT 291 (Tri-Ahmd)
b) Demosha Chemicals Pvt. Vs CCE Daman 2014 (36) STR 758 (Tri-Ahmd)
c) Precision Wires India Ltd Vs CCE Vapi 2013 (31) STR 62 (Tri-Ahmd)
4. After hearing both the sides and on perusal of the records, I find that the Head Office of the appellant was holding Central Excise registration under Business Auxiliary Service since 2004. The appellant company has two units at Ghaziabad and Vapi. In the present case, the Head Office endorsed the invoice in the name of Vapi unit for availing CENVAT Credit. By Master Circular dt.23.08.2007, issued by the Board, clarify as under:-
2.3 An input service distributor is an office or?2.3 establishment of a manufacturer of excisable goods or provider of taxable service. It receives tax paid invoices/bills of input services procured (on which Cenvat credits can be taken) and distributes such credits to its units providing taxable services or manufacturing excisable goods. The distribution of credit is subject to the conditions that, - (a) the credit distributed against an eligible document shall not exceed the amount of service tax paid thereon, and (b) credit of service tax attributable to services used in a unit either exclusively manufacturing exempted goods or exclusively providing exempted services shall not be distributed. An input service distributor is required (under Section 69 of the Act, read with Notification No. 26/2005-S.T.) to take a separate registration.
5. It is seen that as per Master Circular, ____________ of the appellant company has incorporated the additional service as Input Service Distributor (ISD) w.e.f. 21.11.2007 in the registration, which they are holding since 2004. Therefore, in the present case, it cannot be said that the Head Office was not registered with the Service Tax authorities. I find that the Tribunal in the appellants own case, for the subsequent period in the case of CCE Vapi Vs Samita Conductors Ltd 2012 (278) ELT 492 (Tri-Ahmd) rejected the appeal filed by the Revenue. The relevant portion of the said decision is reproduced below:-
3.?I have considered the submissions. I find that the decision in the case of Jindal Photo Limited was rendered in exactly similar circumstances. In that case also the registration was not taken by the head office as input service distributor. Further, I am unable to appreciate the stand taken by the Revenue that this decision is not applicable in view of the judgment in the case of Jindal Photo Limited deals with modvat/cenvat credit of goods and in this case the question involved is services. This itself is a wrong submission since in Jindal Photo Limited case also the ratio involved was cenvat credit on input services only. Further, it has also been submitted that receipt of goods is verifiable but not the services. In this connection it would be worthwhile to see the provisions to provisos of sub Rule 2 of Rule 9 of Cenvat Credit Rules, 2004. According to the said proviso, if the invoices do not contain all the particulars but contains certain details specified therein, the Assistant Commissioner can allow the credit on the basis of such defective documents, if the goods or services covered by such documents, have been received and accounted for in the books of accounts of the receiver. The submissions made by the appellant in this case is contrary to the provisions of law which require the Assistant Commissioner/Dy. Commissioner to verify whether input services have been received or not. This amounts to a submission that while formulating the Rules, the Government did not consider the practicability or otherwise of verification of receipt of input services. It is the duty of the executives to implement the provisions of rules and if there is any problem in implementing the rules, the rules have to be got amended but certainly the submissions like this not called for. In view of the fact that the ratio is covered by the decision of this Tribunal and I do not find anything wrong with the decision of the Commissioner in following the same and I also find the submission that why this decision is not applicable are not at all correct, I find no merit in the appeal filed by the Revenue and accordingly reject the same.
6. The case laws relied upon by the learned Authorised Representative are not applicable in the present case for the reason that in that case, the ISD was not registered with the authorities.
7. I also notice that on the identical issue, there are series of decisions where the Tribunal held that the credit availed by the manufacturing unit prior to ISD registration by the Head Office cannot be denied. I have also noticed that the Revenue has not made out a case that the appellant had availed CENVAT Credit which is within the restriction (??) of the ISD registration and therefore, there is no reason to deny the CENVAT Credit.
8. In view of the above discussion, I do not find any reason to interfere the order of the Commissioner (Appeals). Accordingly, the appeal filed by the Revenue is rejected. The cross objection is also disposed of.
(Dictated & Pronounced in Court) (P.K. Das) Member (Judicial) cbb 5