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The present appeal has been filed by the Appellant assailing the impugned Order-In-Appeal No. 175-COMMR-A-ST- APPL-KNP-2018, dated-20.03.2018 passed by Commissioner (Audit), Central Tax & Central Excise, Kanpur.

2. The facts of the case in brief are that the Appellant had undertaken manufacture of Parle Branded confectionaries as Contract Manufacturing Unit (CMU) on behalf of the principal M/s Parle Biscuits Pvt. Ltd. The activity of manufacture undertaken is as per clause (ii) of Notification No.36/2001-CE(NT) dated 26.6.2001 for which an authorization dated 17.4.2009 as required under said Notification has been filed with the jurisdictional ACCE. As per clause (ii) of Notification No.36/2001-CE(NT), the inputs, capital goods were procured by M/s Parle Biscuits Pvt. Ltd., the principal manufacturer, which were received in factory of Appellant directly from the manufacturer-suppliers on payment of excise duty for use in manufacture of confectionaries on behalf of principal.

3. In the Show Cause Notice1 dated 03.05.2014, the allegation is that Cenvat Credit of Rs.16,04,120/- availed on ISD invoices of Principal Manufacturer M/s Parle Biscuits (P) Ltd. Mumbai during the period from April 2013 to September 2013 is in contravention of erstwhile Rule 7 of CCR,2004 which allows distribution of cenvat credit by ISD to its manufacturing unit as the assessee is a separate entity and not a unit of Parle, hence proposal for recovery of wrongly availed cenvat credit along with interest and penalty was made.

6. In Order-in-Appeal, the Commissioner (Appeals) has mentioned that appellant are not eligible for availing credit as they are not the manufacturing unit of the ISD i.e. Parle Biscuits.

7. Hence the present appeal before the Tribunal.

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8. The learned Advocate appearing on behalf of the Appellant submits that the Appellant is manufacturing final products - namely Parle branded Confectioneries namely Mango bite and Kismi Toffee undertaken by Appellants is on behalf of principal M/s Parle Biscuits Pvt. Ltd. under clause (ii) of Notification No.36/2001-CE(NT) dated 26.06.2001 wherein inputs are converted into finished goods /final products - Confectioneries which are packed in wrappers /corrugated boxes and despatched on payment of duty on behalf of principal manufacturer M/s Parle Biscuits Pvt. Ltd. to their depots for sale. The entire manufacturing activity is undertaken by Appellants as Contract Manufacturing unit (CMU) and not just a job-worker to carry out some process as fully manufacturing process on final product is carried-out by Appellant on behalf of principal and duty paid on Retail Sale Price under Section 4A of CEA.

11. The definition of 'input service distributor' under Rule 2(m) of CCR 2004 means office of manufacturer of final products which receives invoices towards purchase of input services for distribution of credit 'to such manufacturer' read with Rule 7 allowing distribution of credit to 'manufacturing unit', the credit taken is not deniable.

12. The office of the ISD M/s Parle Biscuits Pvt. Ltd. and the Appellant is one and same. Moreover, final products Confectioneries manufactured at Appellant's factory for M/s Parle Biscuits Pvt. Ltd. have used for input service of advertisement /sale promotion, hence credit passed on through ISD invoices is admissible.