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2018 (4) TMI 1642 - AT - Service TaxCENVAT Credit - input services - outdoor catering service - rent-a-cab service - transport of goods by road - denial on account of nexus - Held that - The respondents are providing services of container handling, storage, cargo planning etc. within Chennai Port area. The services impugned in this appeal were availed by the respondent for providing output services and therefore qualifies as input service. Similar view expressed in the case of THE COMMISSIONER OF CENTRAL EXCISE CHENNAI II COMMISSIONERATE VERSUS M/S. BRITANNIA INDUSTRIES LTD., THE CUSTOMS, EXCISE AND SERVICE TAX 2015 (3) TMI 1043 - MADRAS HIGH COURT , where it was held that credit is allowed. Appeal dismissed - decided against Revenue.
Issues:
- Eligibility of credit on various input services such as outdoor catering service, rent-a-cab service, and transport of goods by road. Analysis: The appeal was filed by the Revenue against the order passed by the Commissioner (Appeals) allowing credit on various input services. The Revenue contended that the respondent availed credit on services like outdoor catering, rent-a-cab, and transport of goods by road, which they argued had no nexus with the output service provided by the respondent, making them ineligible for credit. On the other hand, the respondent argued through their counsel that during the relevant period from February 2005 to March 2008, the definition of input services had a broad scope, including "activities relating to business." They justified availing CENVAT credit on services like canteen charges, rent-a-cab for employee transportation, and transportation of goods from port to CFS, asserting that these services were closely linked to the output service provided by the respondent, thus making them eligible for credit. The Tribunal noted that the respondent was engaged in providing services like container handling, storage, and cargo planning within the Chennai Port area. After examining the records, the Tribunal found that the services in question were indeed utilized by the respondent for providing output services, thereby meeting the criteria to be classified as input services eligible for credit. The Tribunal agreed with the Commissioner (Appeals) and cited a similar view upheld by the jurisdictional High Court in a previous case involving Britannia Industries Ltd. The Tribunal also referenced a decision from the Bombay High Court regarding Ultratech Cement Ltd. Based on these precedents, the Tribunal concluded that the Commissioner's decision to allow credit on the disputed services was appropriate, and hence dismissed the appeal filed by the Revenue. In conclusion, the Tribunal upheld the Commissioner's decision, emphasizing the nexus between the input services availed by the respondent and the output services provided, thereby affirming the eligibility of credit on services like outdoor catering, rent-a-cab, and transport of goods by road. The decision was supported by legal precedents and established principles, leading to the dismissal of the Revenue's appeal.
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