2025-VIL-997-CESTAT-CHE-CE
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CENTRAL EXCISE CESTAT Cases

Central Excise - Cenvat Credit on Sales Commission, Sales Promotion - Appellant availed Cenvat credit of service tax paid on the sales commission paid to domestic marketing agents for the sale of finished goods during the period from 01.04.2011 to 31.12.2014 – Denial of Cenvat credit on the ground that the services of the marketing agents were not related to the manufacturing activity and did not fall within the definition of 'input services' under the Cenvat Credit Rules, 2004 - Whether the services of the marketing agents, which involved the entire gamut of services of sale, advertisement and sales promotion, are covered under the definition of 'input services' under the Cenvat Credit Rules, 2004 - HELD - Advertisement or sales promotion service has been specifically included in the scope of input service as defined in Rule 2(l) of the CCR - The activities undertaken by the marketing agents of the appellant are covered under the inclusive part of 'advertisement or sales promotion' service in the definition of 'input service' under the Cenvat Credit Rules, 2004 - The CBEC Circular No.943/4/2011-CX dated 29-04-2011, clarified that credit is admissible on the services of sale of dutiable goods on commission basis – The decision in Cadila Healthcare Ltd. relied upon by the department, is distinguishable as in the present case, the facts showed that the marketing agents were involved in sales promotion activities, unlike in Cadila Healthcare Ltd. Accordingly, the appellant is entitled to the Cenvat credit on the commission paid to the marketing agents – The appeal is allowed - Whether the extended period of limitation can be invoked in the present case - HELD - The extended period of limitation cannot be invoked in the present case as there was no positive act of wilful suppression or misstatement of facts by the appellant, and the issue involved was interpretational in nature. The Tribunal relied on the decision of the Supreme Court in International Merchandising Company, LLC v. Commissioner, Service Tax, New Delhi to hold that the extended period cannot be invoked in such cases.
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