2017 (6) TMI 910 - HC - Service Tax

CENVAT credit - input services - rent a cab services/air travel agent s service/tour operator service - denial on account of nexus - Held that - the decision in the case of Commissioner of Central Excise Versus M/s. Visteon Automotive Systems India (P) Limited 2016 (12) TMI 1383 - MADRAS HIGH COURT relied upon, where it was held that availing of such services are necessary to the manufacture and transporting the workers to and fro from the factory is included under input services, in relation to the manufacture of excisable goods - credit allowed - appeal dismissed - decided against Revenue.

Summary

Issues:
Interpretation of the definition of 'input service' under Rule 2(l) of the CENVAT Credit Rules, 2004.

Analysis:
The High Court admitted the appeal and framed two questions of law for adjudication, but the parties agreed that the first question sufficed. The key question was whether the CESTAT was correct in allowing the assessee to avail CENVAT credit on specific services provided to staff/employees of the factory, even though these services did not fall under the definition of 'input service' as per Rule 2(l) of the CENVAT Credit Rules, 2004. The Court noted that the Revenue's argument was covered by a Supreme Court judgment and a Division Bench judgment of the same Court, which supported the view that such services did not qualify as input services. Consequently, the appeal filed by the Revenue was dismissed, upholding the impugned judgment. The Court ruled in favor of the Assessee and against the Revenue on the question of law. No costs were awarded in the matter.