2017 (9) TMI 1816 - AT - Central Excise

CENVAT Credit - input services - Construction /cleaning service undertaken at its residential colony guest house and other places situated outside the factory area - HELD THAT - The issue arising out of the present dispute is no more open for any debate in view of the decision of this Tribunal in the case of appellant itself wherein by placing reliance on the judgment of Hon ble Anthra Pradesh High Court in the case of COMMISSIONER OF CUS. C. EX. HYDERABAD-III VERSUS ITC LIMITED 2011 (11) TMI 516 - ANDHRA PRADESH HIGH COURT the Tribunal has allowed the Cenvat benefit in respect of the services used /utilized in the residential colony and the guest house which were situated at a place away from the factory. The Cenvat Credit taken by the appellant in respect of the taxable services should merit consideration as input service for the purpose of availment of cenvat benefit - credit allowed - appeal allowed - decided in favor of appellant.

Summary

Issues:
1. Availability of Cenvat Credit on services provided outside the factory premises.
2. Interpretation of input service for the purpose of Cenvat benefit.

Analysis:
1. The appellant, engaged in white cement manufacturing, availed Cenvat Credit on services like construction and cleaning outside the factory area. The Department denied the credit, stating the services were not related to the final product's manufacture. The Commissioner (Appeals) upheld the denial. The appellant appealed to the Tribunal.

2. The appellant's advocate argued that a previous Tribunal decision supported their claim, asserting the services should be considered input services. The respondent's representative supported the denial, citing a Bombay High Court judgment that services must be linked to final product manufacture for Cenvat benefit.

3. The Tribunal reviewed the case and past decisions. It noted a previous ruling allowing Cenvat benefit for services in a residential colony near the factory. The Tribunal distinguished a Bombay High Court case cited by the respondent, stating it was not applicable. Considering settled law, the Tribunal found the appellant's Cenvat Credit claim valid as input services, overturning the lower authority's decision.

4. The Tribunal concluded that the disputed services were eligible for Cenvat Credit as input services, aligning with legal precedents. The impugned order was set aside, and the appeal was allowed in favor of the appellant.