Commissioner of CGST & Cental Excise Vs Oerlikon Balzars Coating India Pvt. Ltd. (CESTAT Mumbai)
Rule 7 was amended with effect from 01.04.2016 making pro tata distinction mandatory; during the period in question; there was no such restriction
We share the recent order passed by the Hon’ble CESTAT Mumbai. The assessee is engaged in providing coating services. It has registered office at Pune. The said coating services are providing from various units located across the country. It has an agreement with the foreign principal for receipt of technical know how etc. On payment of technical know how fees and royalty, the assessee paid service tax on reverse charge basis. It availed credit. Such cenvat credit was sought to be denied on the ground that the entire service is not received by Pune unit and hence, such credit cannot be availed at Pune. Show cause notice was issued for period 2014-2015. Demands along with interest and penalty were confirmed. On appeal, the Commissioner (appeals) allowed the appeal. Hence, appeal by Revenue before CESTAT.
Hon’ble CESTAT, Mumbai dismissed the appeal filed by the Department. It held: (i) the issue is covered for earlier period in assessee’s own case; (ii) the appeal filed by the department against such order has been dismissed by Bombay High Court; (iii) Rule 7 was amended with effect from 01.04.2016 making pro tata distinction mandatory; during the period in question; there was no such restriction; (iv) the entire exercise is revenue neutral.
