2015 (2) TMI 1185 - AT - Central Excise

Cenvat credit - input services credit on security services availed by the appellant in residential colony - constructed residential colony for residence of their employees to facilitate the working of the factory round the clock - nexus of security services as residential colony with the activity in the manufacturing of appellant - Held that - as I find that in appellant s own case for subsequent period this Tribunal held that they are entitled to take Cenvat Credit therefore I do not find any need to refer the matter to the larger bench to decide the issue. Therefore by following the preceded decision of this Tribunal in appellant s own case I hold that they are entitled to take Cenvat Credit on security services availed in residential colony which is located near to the factory in remote area. The impugned order is set aside. - Decided in favour of appellant

Summary

Issues:
Denial of input services credit on security services availed in a residential colony under Rule 2(l) of Cenvat Credit Rules, 2004.

Analysis:
The appellant, a cement manufacturer, appealed against the denial of Cenvat Credit on security services in a residential colony, contending that the services had a nexus with their manufacturing activity. The appellant cited a decision by the High Court of Andhra Pradesh and previous Tribunal orders in their favor. The respondent argued against the credit, referencing a Bombay High Court decision. The Tribunal noted conflicting decisions by different High Courts but relied on its own previous decision favoring the appellant. The Tribunal found similarities with the Andhra Pradesh High Court case and ruled in favor of the appellant, allowing the Cenvat Credit for security services in the remote residential colony near the factory.

The Tribunal emphasized that since the conflicting High Court decisions were not jurisdictional, it had the liberty to decide independently. Given the precedent set by the Tribunal in the appellant's previous case and the similarity of facts with the Andhra Pradesh High Court case, the Tribunal concluded that the appellant was entitled to claim the Cenvat Credit. Consequently, the impugned order denying the credit was set aside, and the appeal was allowed with any consequential relief.