RAKESH KUMAR, MEMBER (T) -
(1.)THE appellant in their unit at Plot No. 407, Sector -8, IMT Manesar, Gurgaon, they manufacture 'Automotives Parts' chargeable to Central Excise Duty under tariff sub -heading 94019000 of the Central Excise Tariff. The period of dispute in this case is from September, 2011 to February, 2012. The appellant company was availing Cenvat credit of Central Excise duty paid on inputs and capital goods and Service Tax paid on input services as per the provisions of the Cenvat Credit Rules, 2004. The appellant company is a subsidiary company of M/s. Faurecia Sieges d' Automobile (FSA), France. During period from March, 2011 to February, 2012, FSA, France issued 11 invoices to the appellant company regarding certain business support services provided to the appellant company against which the appellant company made the payment and in respect of these services received, the appellant company paid Service Tax as service recipient in terms of the provisions of Section 66A of Finance Act, 1994 read with Rule 2(1)(d)(iv) of the Service Tax Rules, 1994. The total Service Tax payment is of Rs. 2,63,03,909/ -. They took Cenvat credit of this Service Tax paid in their Cenvat credit account. In the course of audit of the records, it was found that the invoices of FSA, France, on the basis of which the Cenvat credit, in question, had been taken, were in the name of M/s. Faurecia Automotives Seating India, Bangalore, whereas Service Tax credit had been availed at Gurgaon Unit of M/s. Faurecia Automotives Seating India Limited. The department was accordingly of the view that this Cenvat credit would not be admissible and it is on this basis that the show cause notice dated 7 -3 -2013 was issued to the appellant company for recovery of wrongly taken Cenvat credit amounting to Rs. 2,63,03,904/ - from the appellant company along with interest on it under Section 11AA/AB of the Central Excise Act, 1944 and also for imposition of penalty on them under Rule 15(2) of Cenvat Credit Rules, 2004. Show cause notice was adjudicated by the Commissioner vide Order -in -Original dated 24 -4 -2014 by which the above -mentioned Cenvat credit demand was confirmed against the appellant along with interest and penalty of Rs. 1,31,51,955/ - was imposed on them under Rule 15(2) of Cenvat Credit Rules, 2004 read with Section 11AC of the Central Excise Act, 1944. Against this order of the Commissioner, this appeal has been filed along with stay application.
(2.)Heard both the sides in respect of the stay application.
(3.)SHRI Alok Yadav, advocate, ld. counsel for the appellant, pleaded that the appellant company is a subsidiary company of FSA, France manufacturing components of automotive seats; that initially the unit has been set up in Bangalore in 1997 which was functional till April, 2007; that thereafter a new unit was set up in Manesar, Gurgaon; that in terms of the agreement of the appellant company with its parent company FSA, France, the parent company had provided certain business support services during March, 2011 to February, 2012 period, and payment for these services had been made by the appellant; that these services had been received in respect of the Gurgaon Unit only which was functioning at that time; that it is the Gurgaon Unit which had paid Service Tax as service recipient under Rule 2(1)(d)(iv) of the Service Tax Rules, 1994; that this fact is clear from the GAR -7 Challans, some of which are placed on records; that the parent company mentioned the Bangalore address in the invoice, as originally these services were meant for Bangalore Unit but since the Bangalore Unit had closed down and at that time it is only the Manesar Unit which was functioning, the services had been received at Manesar Unit; that when services, in question, in respect of which the payment had been made by the appellant company, had been received at Gurgaon by the Gurgaon Unit, the Service Tax credit cannot be denied, more so, when it is Gurgaon Unit which has paid the Service Tax; that in any case, since all the GAR -7 Challans, the address of the Gurgaon Unit is mentioned against the column for taxpayers' address and since in terms of Rule 9(1)(e) of Cenvat Credit Rules, 2004, in case of person liable to pay Service Tax under Rule 2(1)(d)(v) of Service Tax Rule, 1994, Cenvat credit would be permissible on the basis of GAR -7, even if, the invoices mention the address of the Bangalore Unit, this Cenvat credit cannot be denied and that in view of this the impugned order is not correct. He therefore, pleaded that the appellant have strong prima facie case in their favour and hence, the requirement of pre -deposit of Cenvat credit demand, interest and penalty may be waived for hearing of the appeal and the recovery thereof stayed.