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Issues involved: Admissibility of Cenvat credit on input services such as catering services and guest house services in a manufacturing unit.
Catering services: The Revenue appealed against the allowance of Cenvat credit on catering services, arguing lack of nexus with manufacturing activities. The Deputy Manager for the respondent cited a Bombay High Court decision supporting catering service as an eligible input service, subject to conditions. The appellant had recovered costs from employees during the period in question and offered to reverse the proportionate Service Tax credit. The Tribunal upheld the admissibility of Cenvat credit on catering services, with the condition that credit for recovered costs must be reversed with interest. Guest house services: The Deputy Manager contended that guest house services had a nexus with manufacturing activities as they were used by company employees. However, the Tribunal found no established nexus between guest house services and manufacturing activities. Consequently, the order allowing input Service Tax credit on guest house services was set aside, while upholding the rest of the impugned order and rejecting the Revenue's appeal.
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