2016 (4) TMI 1147 - AT - Central Excise

Denial of Cenvat credit of the service tax paid on the services used for cleaning and maintaining the factory - Held that - Section 11 of the Factories Act, 1948 having casted the responsibility on the appellant to keep its factory clean as a statutory obligation, there cannot be denial of the Cenvat credit of the service tax paid on the services used for cleaning and maintaining the factory. Tribunal has already taken a view in this manner in the case of Delphi Automotive Systems Pvt. Ltd., Vs Commissioner of Central Excise, Noida (2015 (11) TMI 714 - CESTAT NEW DELHI ). - Decided in favour of assessee

Summary

The Appellate Tribunal CESTAT CHENNAI allowed the appeal, stating that denial of Cenvat credit for service tax paid on cleaning services would defeat the purpose of the Factories Act, 1948. The responsibility of keeping the factory clean is a statutory obligation under Section 11 of the Act. The Tribunal had previously ruled similarly in the case of Delphi Automotive Systems Pvt. Ltd. vs Commissioner of Central Excise, Noida.