M/S. Sar Ispat Pvt. Ltd vs Commissioner Of Central Excise, ...
- CitationAppeal No.19/2014 (P) , dated 05.12.2014 passed by the Commissioner of Central Excise (
Ratio decidendi
The rule this decision rests on
Where a manufacturing facility's security services and sales commission are availed, the Cenvat credit eligibility of the service tax paid on them is to be determined under Rule 2(l) of the Cenvat Credit Rules, 2004; the expenditure need not be isolated for credit to be admissible, and service tax paid on security services used for protection of the factory is admissible credit where there exists an inextricable link between those services and the manufacturing facility in which they are used. Service tax paid on sales commission, being attributable to the promotion of sales of the finished product, is not denied Cenvat credit merely because the commission is an expense of sales promotion, provided the service availed is treated as connected with the manufacture and clearance of the product under Rule 2(l).
Written by Miss Lucy from the judgment below, not taken from a headnote.
Judgment
As delivered
[Arising out of Order-in-Appeal No.19/2014 (P) , dated 05.12.2014 passed by the Commissioner of Central Excise (Appeals), Chennai ]
M/s. SAR ISPAT PVT. LTD. APPELLANT
Versus
COMMISSIONER OF CENTRAL EXCISE, PUDUCHERRY RESPONDENT
Appearance:
For the Appellant Shri S. Venkatachalam Adv.
For the Respondent Shri L. Paneerselvam AC (AR)
CORAM:
Honble Shri D.N. Panda, Judicial Member
Date of hearing/decision 16-01-2015
FINAL ORDER NO. 40072 / 2015
Per D.N. Panda:
Application supported by affidavit explains the reason for delay. That is allowed being reasonable, condoning the delay of 62 days in filing the appeal.
2. Appeal is taken up for disposal being on very narrow compass. Learned advocate says that there was denial of Cenvat credit on security services availed for the factory and sales commission paid against Business Auxiliary Service availed. The security services being in accordance with law connected with the provision of the factory and sales promotion being attributable for promoting sales, and the provision of Rule 2 (l) of Cenvat Credit Rules, 2004, permits consideration of eligibility of the appellant to the Cenvat credit that may be allowed.
3. The nexus of the expenditure on security services used for the factory and manufacture facility there at being not possible to be isolated, Rule 2(l) of the Cenvat Credit Rules, 2004 allows Cenvat credit on service tax paid to avail such service and sales promotion expenses being attributable to the service availed, input credit of service tax credit paid cannot be denied on the commission paid. Further, the service tax paid on the security service availed for protection of factory is admissible for existence of inextricable link between the services and the manufacturing facility for which that was used. Accordingly, appeal is allowed.
(Dictated and pronounced in open court)
(D.N. PANDA) JUDICIAL MEMBER
ksr 28-01-2015
DRAFT Remarks
I II III
Date of dictation 16.01.2015
Draft Order - Date of typing 16.01.2015
Fair Order Typing 28.01.2015
Date of number and date of dispatch 28.01.2015
4 E/COD/41916/2014 and E/41919/2014
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