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2013 (6) TMI 214 - AT - Central ExciseInput service credit denied - Outward transportation service & Manpower supply service - Held that - Although there is a change in the definition of input service credit post 1.4.2008, but an assessee who qualifies the condition laid down in Board s Circular NO.97/08/2007-S.T. dated 23.08.2007 is entitled for input service credit. Admittedly, in this case as per the sale agreement the goods were supplied on CIF, FOB or DDU basis. Therefore, the first condition of the said circular is satisfied and when the goods are transported upto port by the appellant therefore the risk of loss or damage to the goods are also vested with the appellant. It is not in dispute that the freight charges were not integral part of the sale value of the impugned goods. As the appellant has satisfied the condition of Circular No. 97/08/2007 dated 23.08.2007, therefore, the appellants are entitled for input service credit. See Ambuja Cements Ltd. vs. Union of India 2009 (2) TMI 50 - PUNJAB & HARYANA HIGH COURT As for bonus and lunch allowance, the supplier of manpower has raised invoices of the services provided by him and the appellants have become service recipient thereon, thus as held in Ultratech cement (2010 (10) TMI 13 - BOMBAY HIGH COURT) that any services availed by the manufacturer of excisable goods in the course of business is entitled for input service credit, therefore the appellants are entitled for input service credit.
Issues:
1. Denial of input service credit on outward transportation service. 2. Denial of input service credit on manpower supply service. Analysis: 1. The appellants challenged the impugned order denying input service credit on outward transportation service and manpower supply service. The Revenue contended that input service credit for transportation service is only available up to the place of removal, and post-31.3.2008, credit beyond the factory was not permissible. Similarly, the Revenue argued that bonus and lunch allowances were not part of manpower services, thus not eligible for input service credit. 2. The appellants, relying on Board's Circular No.97/08/2007, asserted their entitlement to input service credit for outward transportation service up to the port as per the sale agreement terms. They also claimed credit for bonus and lunch allowances provided to employees by the manpower supplier, citing the decision of the Hon'ble High Court of Bombay in the case of Ultra Tech Cement Ltd. 3. The Tribunal considered the arguments from both sides. Despite the change in the definition of input service credit post-1.4.2008, the Tribunal held that as per Circular No. 97/08/2007, if the conditions were met, the appellant was entitled to credit. The Tribunal noted that the goods were supplied on CIF, FOB, or DDU basis, meeting the circular's first condition. Additionally, the Tribunal found that bonus and lunch allowances were invoiced by the manpower supplier, making the appellants service recipients eligible for input service credit. 4. Citing the decision of the Hon'ble High Court of Punjab & Haryana in the case of Ambuja Cements Ltd. vs. Union of India and the Hon'ble High Court in the case of Ultra Tech Cement Ltd., the Tribunal concluded that the appellants fulfilled the conditions for input service credit on both outward transportation service and manpower supply service. Therefore, the impugned order was set aside, and the appeal was allowed with consequential relief, if any.
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