2016 (7) TMI 1167 - AT - Central Excise

CENVAT credit claimed on the transport service availed to bring the workers to their factory site - Held that - When the nexus and integral connection of input with the manufacture comes out, it would not be proper to entertain Revenue appeal since no evidence has come from Revenue to impeach the order of the Commissioner (Appeals). Such decision can be taken following the ratio laid down by the Apex Court in the case of Ramala Sahkari Chini Mills Ltd. Vs. Commissioner of Central Excise, Meerut (2010 (11) TMI 34 - SUPREME COURT OF INDIA ). There is no finding by the authority as to the absence of the nexus between the manufacture and the input service.Revenue has no material to contradict above proposition of the respondent. Accordingly, respondent is also entitled to CENVAT credit of the air travel agency service availed by it. - Decided in favour of assessee.

Summary

Issues:
1. Disagreement over CENVAT credit claimed on transport service for workers.
2. Examination of nexus between input and manufacture for CENVAT credit.
3. Disposal of Revenue's appeal regarding CENVAT credit on air travel agency service.

Analysis:
1. The judgment involves a dispute regarding the CENVAT credit claimed by the respondent on the transport service used to bring workers to their factory site. The Revenue disagreed with the contentions of both authorities below on this matter.

2. The Tribunal carefully considered the issue of nexus between the input service and the manufacturing process. It was noted that the adjudicating authority had examined the distance between the place of work and where workers were picked up. The Tribunal emphasized that when the connection of the input with manufacturing is established, it is inappropriate to entertain Revenue's appeal without evidence to challenge the Commissioner (Appeals) order. The Tribunal referred to the precedent set by the Supreme Court in the case of Ramala Sahkari Chini Mills Ltd. Vs. Commissioner of Central Excise, Meerut.

3. The Tribunal also addressed the issue of CENVAT credit on air travel agency services. The respondent argued that the service was utilized for manufacturing and business purposes, highlighting the nexus between the service and the manufacturing process. Since Revenue failed to provide evidence contradicting this argument, the Tribunal ruled in favor of the respondent, allowing CENVAT credit for the air travel agency service.

In conclusion, the Tribunal dismissed Revenue's appeal, following the precedent and maintaining judicial discipline in line with a previous final order. The judgment emphasizes the importance of establishing a nexus between input services and manufacturing processes to support claims for CENVAT credit.