2017 (2) TMI 1328 - AT - Central Excise

CENVAT credit - input services in relation to organising the function of Family Day - event management services - security services - insurance services for insurance of the function - Pandal & shamiana services - Held that - Admittedly, the services of Family Day was celebrate for the workers who are working in the factory of the appellant. The said function will boost the month of the worker to produce more - the activity of Family Day function is related to the business activity of the appellant - credit allowed - appeal allowed - decided in favor of appellant.

Summary

Issues: Denial of input service credit for organizing Family Day function under various service categories.

In the judgment delivered by Hon'ble Mr. Ashok Jindal, Member (Judicial) of the Appellate Tribunal CESTAT Chandigarh, the main issue revolved around the denial of input service credit to the appellant for organizing a Family Day function. The denial was based on the categorization of the services utilized for the event, including event management services, security services, insurance services, and Pandal & shamiana services, as not qualifying under Rule 2(l) of the Cenvat Credit Rules, 2004.

Upon hearing the parties and considering their submissions, the Tribunal referred to a precedent set by the Hon'ble Apex Court in the case of M/s Ultratech Cement Ltd. The court held that any services availed by the manufacturer of excisable goods in the course of their business are eligible for input services credit. In this case, the Family Day function was organized for the workers employed in the appellant's factory to boost their morale and productivity. The Tribunal concluded that the Family Day function was related to the business activity of the appellant, thereby entitling them to avail Cenvat credit for the event management service, security service, and Pandal & Shamiana services utilized for the function.

Consequently, the impugned order denying the input service credit was set aside, and the appeal was allowed with any consequential relief deemed necessary. The judgment highlights the importance of interpreting the scope of input service credit eligibility in alignment with the business activities and objectives of the appellant, ensuring a fair and just application of the Cenvat Credit Rules, 2004.