The Customs, Excise, and Service Tax Appellate Tribunal (CESTAT), Chennai has granted a major relief to Mitsubishi Heavy Industries India Precision Tools Ltd, one of the World’s leading manufacturers of Gear Cutting Tools and Broaches.
The Tribunal was considering an issue whether the Company is eligible to avail credit in respect of the amount of service tax paid to the commission agents while paying commission.
Earlier, the department had rejected the appellant-Company’s request to allow cenvat credit on the service tax of commissions paid to commission agents in regard to sales promotion of their products stating that the same is a post manufacturing activity, for which credit is not available.
Shri M.N. Bharathi, the lawyer represented the appellant before the Tribunal submitted that the department has denied the credit alleging that it is post-manufacturing activity. He explained that such agents are appointed for marketing and promotion of their products and, therefore, it is covered by the definition of “input services”. He further relied upon the Final Order No.40867/2020, dated 28.10.2020 in the appellant’s own case passed by the Division Bench of the Tribunal.MitsubishiShri M.N. Bharathi, the lawyer represented the appellant before the Tribunal submitted that the department has denied the credit alleging that it is post-manufacturing activity. He explained that such agents are appointed for marketing and promotion of their products and, therefore, it is covered by the definition of “input services”. He further relied upon the Final Order No.40867/2020, dated 28.10.2020 in the appellant’s own case passed by the Division Bench of the Tribunal.
Allowing the plea of the appellant, the Tribunal bench comprising Judicial Member Sulekha Beevi C.S. held that “after hearing both sides, I am convinced that the issues stand covered by the decision in the appellant’s own case cited supra wherein the reasons have been discussed in detail. Following the same, the impugned order is set aside. The appeal is allowed with consequential reliefs if any.”
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