2016 (2) TMI 557 - AT - Central Excise

Entitlement to claim CENVAT Credit of input services - services of travel agent - Held that - This Tribunal in the appellant s own case 2012 (11) TMI 376 - CESTAT, MUMBAI allowed the appeal of the appellant and it has been held that the appellant is entitled to CENVAT Credit on the services of travel agent which was used by the appellant for travelling technicians and accountant for visiting the job workers as per Rule 2(l) of CENVAT Credit Rules, 2004. - Decided in favour of assessee

Summary

Issues involved:
- Appeal against Order-in-Appeal upholding Order-in-Original denying CENVAT Credit under Rule 14 of CENVAT Credit Rules, 2004.
- Claim of CENVAT Credit on services of travel agent for visiting job workers.
- Interpretation of Rule 2(l) of CENVAT Credit Rules, 2004.
- Application of precedent judgments on input service credit entitlement for business-related services.

Analysis:
The appeal challenged the Order-in-Appeal upholding the denial of CENVAT Credit under Rule 14 of CENVAT Credit Rules, 2004. The case involved the appellant, engaged in manufacturing safety razor blades, transporting semi-finished naked blades and packaging materials to job workers at different locations. The job workers processed the goods on behalf of the appellant, who paid service tax on travel agency services for sending personnel to maintain machinery at the job workers' premises. The Adjudicating Authority confirmed a demand raised in a show-cause notice, leading to an appeal before the Commissioner, which was also upheld. Subsequently, the CESTAT allowed the appeal by remanding the case for a fresh decision in light of relevant authorities.

The appellant argued that expenses on travel agency services were essential for the manufacturing business, entitling them to claim CENVAT Credit on input services. The Tribunal referenced a previous judgment in the appellant's case, where it was held that the appellant could claim CENVAT Credit on services of a travel agent used for technicians and accountants visiting job workers, in accordance with Rule 2(l) of CENVAT Credit Rules, 2004. Additionally, the Tribunal cited a judgment of the Hon'ble Bombay High Court in Ultra tech Cement Ltd.'s case, establishing that any service availed for the business of manufacturing final products allows for input service credit entitlement.

Considering the precedent judgments and the Tribunal's previous decision in the appellant's case, it was concluded that the issue was no longer open to debate. The Tribunal allowed the appeal of the appellant, granting consequential relief as applicable. The judgment was pronounced in court on 19.1.2016.