M/S. Cadila Healthcare Limited vs Commissioner Of Central Excise & S.T., ...

(Arising out of OIA-CCEA-SRT-II-SSP-222-U-S-35A dated 07.01.2013, passed by Commissioner (Appeals) Central Excise, & S.T., Surat)

M/s. Cadila Healthcare Limited : Appellant (s)

VERSUS

Commissioner of Central Excise & S.T., Surat : Respondent (s)

Represented by :

For Appellant (s) : Shri H.D. Dave, Advocate For Respondent (s) : Shri T.K. Sikdar, Authorised Representative

For approval and signature :

Mr. H.K. Thakur, Honble Member (Technical)

1 Whether Press Reporter may be allowed to see the Order for publication as per Rule 27 of the CESTAT (Procedure) Rules, 1982?

No 2 Whether it should be released under Rule 27 of CESTAT (Procedure) Rules, 1982 for publication in any authoritative report or not?

No 3 Whether their Lordships wish to see the fair copy of the Order?

Seen 4 Whether Order is to be circulated to the Departmental authorities?

Yes

CORAM :

Mr. H.K. Thakur, Honble Member (Technical)

Date of Hearing / Decision : 14.07.2015

ORDER No. A/11002/2015 Dated 14.07.2015

Per : Mr. H.K. Thakur;

This appeal has been filed by the appellant with respect to OIA No. CCEA-SRT-II-SSP-222-U-S-35A dated 07.01.2013. The issue involved is whether CENVAT credit of service tax paid on commission charges under Business Auxiliary Services, paid to the Foreign Agency by the appellant will be admissible under Rule 2(l) of Cenvat Credit Rules, 2004.

2. Shri H.D. Dave (Advocate) appearing on behalf of the appellant argued that on merits the issue has been decided against the assesses by the Hon'ble Gujarat High Court in the case of CCE, Ahmedabad vs. Cadila Healthcare  [2013-TIOL-12-HC-AHM-ST]. It was the case of the learned Advocate that demand is time-barred as the show cause notice was issued on 22.03.2011 and the demand pertain to the period April 2006 to November 2007. Learned Advocate argued that admissibility of cenvat credit on Commission Charges paid under reverse charge mechanism was a disputed issue which was settled by the Hon'ble Gujarat High Court in the case of CCE, Ahmedabad vs. Cadila Healthcare (supra). That once there was confusion on the issue then the appellant had bonafide belief that CENVAT credit is admissible.

3. Heard both sides and perused the case records. The issue involved in the present proceedings is CENVAT credit taken by the appellant with respect to Commission Charges paid to the Foreign Agencies, which was required to be paid under reverse charge by the appellant. The issue was decided by the Hon'ble Gujarat High Court in the case of CCE, Ahmedabad vs. Cadila Healthcare in the year 2012. In the present factual matrix, extended period of limitation for demanding duty can not be invoked as the appellant was under bonafide belief that such credit on Commission Charges paid was admissible. It is further observed that show cause notice for the years 2005-06 to November 2007 was issued on 22.03.2011 and was clearly time-barred. Accordingly, appeal filed by the appellant is allowed on the ground of show cause notice being time-barred as extended period of limitation cannot be invoked in this proceeding.

(Order dictated and pronounced in the Court)

(H.K. Thakur) Member (Technical) .KL

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