The combined reading of the Rule 7 and the clarificatory Circular dated 23-8-2007 clearly shows that there are only two restrictions regarding the distribution of the credit. The first restriction is that the credit should not exceed the amount of Service Tax paid. The second restriction is that the credit should not be attributable to services used in manufacture of exempted goods or providing of exempted services. There are no other restrictions under the rules. The restrictions sought to be applied by the Department in this case in limiting the distribution of the Service Tax credit made in respect of the Malur Unit on the ground that the services were used in respect of the Cuttack Unit finds no mention in the relevant rules.
As such, restricting the distribution of Service Tax credit in a manner as has been done by the impugned order of the lower appellate authority (original authority had approved of such distribution) cannot be upheld. In case the Department wants to place such restriction as is sought to be placed in the case, the rule is required to be amended. Pre-deposit waived and recovery stayed
IN THE CUSTOMS, EXCISE AND SERVICE TAX APPELLATE TRIBUNAL
WEST ZONAL BENCH, MUMBAI
Application No. E/S/1946 to 1948, 1960 & 2020/10
Appeal No. E/1804 to 1806, 1814 & 1893/10
ORDER NO. S/795-799/11/EB/C-II
Arising out of Order-in-Appeal No. SB/76, 76A, B, C, D) MV.2010 Dated: 29.7.2010
Passed by the Commissioner of Central Excise (Appeals), Mumbai
Date of Decision: 24.10.2011
TATA STEEL LTD
Vs
COMMISSIONER OF CENTRAL EXCISE, MUMBAI- I
Judiciary
