COMMISSIONER Vs. M/S MEGHMANI FINCHEM LTD.

JUDGEMENT

(1.) This Tax Appeal is filed by the department challenging the order of Customs, Excise and Service Tax Appellate Tribunal dated 31.07.2017. The issue arises in somewhat peculiar background. We may briefly record the facts:

(2.) The principal issue between the department and the respondent-manufacturer is with respect to the assessee's claim of Cenvat credit of service tax paid on sales commission. Such an issue was decided by Division Bench of this Court in case of Commissioner of Central Excise, Ahmedabad v. Cadila Healthcare Ltd reported in 30 STR 3 in favour of the department. This view was reiterated in Astik Dyestuff Pvt. Ltd v. Commissioner of Central Excise and Customs reported in 34 STR 814 following the judgement in case of Commissioner of Central Excise, Ahmedabad v. Cadila Healthcare (supra). The legislature subsequently added an explanation to the definition of term "input service" defined under the Cenvat Rules. This explanation came up for consideration before the Tribunal. Ahmedabad Bench of the Tribunal in case of Essar Steel India Ltd v. C.C.E and S.T, Surat reported in 335 ELT 660 (Tribunal Ahmedabad) held that such amendment is clarificatory in nature and would therefore, with retrospective effect. In essence, it would cover a period prior to the date of amendment i.e. 03.02.2016 also. Such judgement has been challenged by the department before the High Court. Department's appeal is pending.

(3.) Pending such appeal before the High Court, large number of appeals came up for consideration before the Tribunal on this very issue. The department obviously placed heavy reliance on the judgements of High Court in cases of Commissioner of Central Excise, Ahmedabad v. Cadila Healthcare and Astik Dyestuff Pvt. Ltd v. Commissioner of Central Excise and Customs. The assessees relied on the amendment to the definition of term "input service" and argued that the same would apply to all pending cases irrespective of the date of amendment.