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2008 (11) TMI 593 - AT - Central Excise
Issues:
1. Entitlement to input service credit of service tax paid on outdoor catering services. Analysis: In this case, the appellant, Cummins Generator Technologies India Limited, filed a stay petition against the Order-in-Appeal dated 4-4-2008 passed by the Commissioner (Appeals), Central Excise and Customs, Aurangabad. The Commissioner (Appeals) upheld the Order-in-Original dated 15-11-2007 disallowing the Cenvat credit of Rs. 1,25,877/- with interest, but reduced the penalty to Rs. 15,000. The main issue revolves around whether the appellant is entitled to the input service credit of the service tax paid on outdoor catering services provided in their factory canteen, which they claim is a statutory requirement under Section 46 of the Factory Act. Upon hearing both sides and examining the records, it was found that the issue at hand is similar to a previous decision by the Tribunal in the case of Victor Gaskets India Ltd. v. Commissioner of Central Excise, Pune-I, which was upheld by the Larger Bench of the Tribunal in the case of CCE, Mumbai v. M/s. GTC Industries Ltd. In these cases, it was established that outdoor catering services can be considered as an input service, making the service tax credit admissible. Therefore, the Tribunal concluded that the appellant has a strong case for the complete waiver of the pre-deposit of the service tax demanded and the penalty imposed. As a result, the Tribunal dispensed with the pre-deposit of the service tax amount and penalty, staying the recovery pending the appeal's disposal. This judgment provides clarity on the admissibility of Cenvat credit for outdoor catering services, aligning with previous decisions by the Tribunal and the Larger Bench, ultimately benefiting the appellant in this case. This detailed analysis of the judgment highlights the key legal issues, relevant decisions, and the final outcome in favor of the appellant regarding the entitlement to input service credit for service tax paid on outdoor catering services.
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