Custom, Excise & Service Tax Tribunal
M/S. Intimate Fashions India Pvt. Ltd vs Commissioner Of Central Excise, ... on 13 January, 2011
IN THE CUSTOMS, EXCISE & SERVICE TAX
APPELLATE TRIBUNAL
SOUTH ZONAL BENCH, CHENNAI
Appeal Nos. E/544/2009 and E/191/2010
(Arising out of Order-in-Original No. 19/2009 dated 11.8.2009 passed by the Commissioner of Central Excise, Chennai and Order-in-Appeal No. 3/10 (M-III) (D) dated 9.3.2010 passed by the Commissioner of Central Excise (Appeals), Chennai)
For approval and signature:
Honble Ms. Jyoti Balasundaram, Vice President
Honble Dr. Chittaranjan Satapathy, Technical Member
1. Whether Press Reporters may be allowed to see 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 CESTAT (Procedure) Rules, 1982 for publication in any authoritative report or not?
3. Whether the Members wish to see the fair copy of the Order?
4. Whether Order is to be circulated to the Departmental authorities?
M/s. Intimate Fashions India Pvt. Ltd. Appellants
Vs.
Commissioner of Central Excise, Chennai Respondent
Appearance Shri S. Muthuvenkataraman , Advocate, for the Appellants Shri C. Dhanasekaran, SDR for the Respondent CORAM Honble Ms. Jyoti Balasundaram, Vice-President Honble Dr. Chittaranjan Satapathy, Technical Member Date of Hearing: 13.01.2011 Date of Decision: 13.01.2011 Final Order Nos. ____________ Per Dr. Chittaranjan Satapathy Heard both sides.
2. Shri S.Muthuvenkataraman, learned counsel appearing for the appellants states that the appellants have been denied credit of service tax paid by them on the commission given to foreign agents for the service of locating the buyers and find their requirement of the goods to enable the appellants to manufacture and export goods to such buyers thereby boosting exports. He further states that the appellants are a 100% EOU and as such are required to achieve a positive net foreign exchange earning. He also states that under the EXIM Policy in force, under para 6.9.1, net foreign exchange earning is calculated taking into account the commission under dispute. He further relies on the decision of the Tribunal in the case of CCE, Jallandhar Vs. Ambika Overseas 2010 (20) STR 514, wherein it has been held as follows:-
The canvassing and procuring orders are activities preceding removal of the goods by the manufacturers. Without the firm order, the respondents were not expected to remove the goods to a foreign destination. Therefore, the submission of the learned DR that these activities are post removal activities cannot be accepted. Further, the definition of the inputs services includes services used in relation to sales promotion, and these activities can rightly be described as sales promotion activities. Sales promotion activities undertaken at a given point of time also aims at sales of goods which are to be manufactured and cleared in future. Any advertisement given has a long term impact and cannot be treated as post clearance activities and therefore, sales promotion has been specifically included in the definition of input services.
3. He further states that in the case of Cadila Healthcare Ltd. Vs. CCE, Ahmedabad 2010 (17) STR 134 also, credit of tax paid for foreign exchange agents services being for sales promotion has been allowed.
4. Shri C. Dhanasekaran, learned SDR appearing for the Department concedes that in view of the precedent decisions of the Tribunal cited above, the appellants are entitled to the impugned credit.
5. Considering the submissions from both sides as above and relying on the aforecited decisions of the Tribunal, we set aside the impugned orders and allow both the appeals.
(Operative portion of the order was pronounced
in open court on completion of hearing)
(Dr. Chittaranjan Satapathy) (Jyoti Balasundaram)
Technical Member Vice President
Rex
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Appeal Nos.E/544/09 & E/191/10