Kohler India Corporation Private Limited Vs CGST & Central Excise-Vadodara -II (CESTAT Ahmedabad)
CESTAT Ahmedabad has remanded the case of Kohler India Corporation Private Limited versus CGST & Central Excise-Vadodara-II, highlighting the Commissioner’s incorrect application of a GST-era ruling to a pre-GST CENVAT credit matter. The Commissioner disallowed CENVAT credit, despite acknowledging earlier favorable precedents under the Finance Act, 1994 and Rule 2(l) of the CENVAT Credit Rules, 2004. The disallowance was based solely on the Supreme Court’s decision in Safari Retreats Ltd (2024), a judgment concerning the CGST Act.
The CESTAT found that the Commissioner failed to determine if the provisions of the Finance Act, 1994 and the CGST Act, 2017 were pari materia before applying the Safari Retreats Ltd ruling. The tribunal emphasized that a court decision under one legislation cannot be applied to another unless their provisions are similar. The Commissioner is now directed to compare Rule 2(l) of the CENVAT Credit Rules, 2004 (which provides an inclusive definition of input service) with Section 17(5)(d) of the CGST Act, 2017 to ascertain their similarity. Given this is the third round of litigation, the CESTAT has mandated the Commissioner to decide the matter within three weeks of receiving the order, allowing Kohler India to make further submissions.
