2018 (6) TMI 6 – CESTAT NEW DELHI – TMI – Cenvatable services – Services of ‘Sales Commission Agents’ – input services or not? – whether the services of ‘Sales Commission Agents’ can be held to be cenvatable and the Service Tax paid on the same is available as a credit to the assessee? – Time limitation – Held that:- There is no stay of operation of various decisions of the Tribunal, which are in favour of the assessee and which stand referred to by Commissioner (Appeals). Infact nothing has been brought on record to show that said decision of the Tribunal wherein the judgment of Hon’ble High Court of Gujarat in the case of Cadila Healthcare Ltd.[2013 (1) TMI 304 – GUJARAT HIGH COURT] was considered, stand appealed against by them. In that case, the issue is fully covered in favour of the assessee.
–
Period of limitation – no suppression of facts – extended period of limitation – Held that:- Demand is time barred inasmuch as the period involved is April, 2013 to February, 2016 wh
= = = = = = = =
Plain text (Extract) only
For full text:-Visit the Source
= = = = = = = =
le as a credit to the assessee. 3. The appellate authority has held in favour of the respondent by observing as under: 6. I observe from the definition of input service that the services used in relation to sales promotion are covered under the scope of the said definition. Now the question is whether the activities of sales commission agents can be treated as the services used in relation to sales promotion. I find that the commission agent is a key person who identifies the potential buyers, explain them the positives of the product, convince them to buy and procure orders. His activities are entirely related to sales promotion. Without services of commission agents it is very difficult to sell goods. I observe that the clarification issued by the Board vide its circular No. 943/4/2011-CX dated 29.04.2011 specifically, under point No. 5, contains the wording that … Moreover activity of sales promotion is specifically allowed and on many occasion the remuneration for same is li
= = = = = = = =
Plain text (Extract) only
For full text:-Visit the Source
= = = = = = = =
althcare Ltd. reported in [2013 (30) STR 3 (Guj)] relied upon by the adjudicating authority, I find that in that case the Hon ble Court has considered the issue wherein period of demand was prior to year 2008. During the period from year 2008 till date, this issue has been considered by various appellate authorities and the Board has also issued clarification vide Circular dated 29.4.2011. Further as contended by the appellant also, an Explanation in the definition of input service has been inserted vide Notification Nol. 02/2016-CE(NT) dated 3.2.2016 which, as per settled principle of Law, has retrospective effect as the same is in the form of explanation only. This issue has been discussed by Hon ble Tribunal in the case of M/s. Essar Steel India Ltd. [2016 (335) ELT 660 (Tri-Ahmd), wherein it was held that Explanation to Rule 2(l) of Cenvat Credit Rules, 2004 inserted vide Notification No. 2/2016-CE(NT) dated 3.2.2016 holding that sales promotion includes services by way of sale of
= = = = = = = =
Plain text (Extract) only
For full text:-Visit the Source
= = = = = = = =
the plea of the Revenue that the subject explanation would have only prospective effect because, as recorded in the findings above, the explanation always has retrospective effect. 4. Revenue s only grievance is that matter is pending before the Hon ble Supreme Court as they have filed appeal against the Hon ble Rajasthan High Court decision. Learned AR fairly agrees that there is no stay of operation of various decisions of the Tribunal, which are in favour of the assessee and which stand referred to by Commissioner (Appeals). Infact nothing has been brought on record to show that said decision of the Tribunal wherein the judgment of Hon ble High Court of Gujarat in the case of Cadila Healthcare Ltd. reported in [2013 (30) STR 3 (Guj)] was considered, stand appealed against by them. In that case, the issue is fully covered in favour of the assessee. Otherwise also, I find that demand is time barred inasmuch as the period involved is April, 2013 to February, 2016 whereas the show cause
= = = = = = = =
Plain text (Extract) only
For full text:-Visit the Source
= = = = = = = =