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2017 (9) TMI 206 - AT - Central ExciseCENVAT credit - input service - appellants are manufacturer of excisable goods and utilized the Courier Services in sending the Samples, Documents and Finished Goods to their customers - whether the appellants are eligible to CENVAT credit of the Service Tax paid on Courier Services? - Held that - It cannot be denied that Courier Service involves a host of uses relating to the activity of manufacture and sale of goods. For example, the documents relating to technical expert s opinion, sample testing report, sending of samples, machine catalogue etc., are received and dispatched by utilizing the services of Courier and it cannot be said that these are de hors of the activities of manufacturing business - Tribunal in the case of Long Meditech Ltd 2016 (7) TMI 468 - CESTAT CHANDIGARH opined that credit avail on Service Tax paid on Courier Serves is eligible to Cenvat Credit. CENVAT credit - Rent-a-cab services - Held that - The credit of the service tax paid on rent-a-cab for the said purpose has been held to be admissible by the Hon ble Gujarat High Court, in the case of Principal Commissioner vs Essar Oil Ltd 2015 (12) TMI 1062 - GUJARAT HIGH COURT - credit allowed. Appeal allowed - decided in favor of appellant.
Issues Involved: Determination of admissibility of CENVAT Credit for Service Tax paid on 'Courier Services' and rent-a-cab service pre and post 01.4.2011.
Analysis: Issue 1: Admissibility of CENVAT Credit for 'Courier Services' pre and post 01.4.2011: The appeals revolve around the eligibility of CENVAT Credit for Service Tax paid on 'Courier Services' utilized by manufacturers for sending samples, documents, and finished goods. The contention arises from the amendment to the definition of Input Service under Rule 2(l) of CCR, 2004 effective from 01.4.2011, which deleted the expression 'activities relating to business.' The Revenue argues that 'Courier Services' fall outside the scope of Input Services post-amendment, as they are strictly connected to business activities and not directly related to manufacturing. However, the appellants assert that even after the amendment, 'Courier Services' remain integral to the manufacturing process, as they are necessary for activities like marketing, sales promotion, and sending essential documents. The Tribunal's previous decisions in cases like Life Long Meditech Ltd and Sunbeam Generators Pvt Ltd support the view that 'Courier Services' have a nexus with manufacturing activities and are eligible for CENVAT Credit. Ultimately, the Tribunal rules in favor of the appellants, allowing CENVAT Credit for 'Courier Services' both pre and post 01.4.2011. Issue 2: Eligibility of Credit for rent-a-cab service: The judgment also addresses the eligibility of CENVAT Credit for the Service Tax paid on rent-a-cab services used for transporting employees. The Hon'ble Gujarat High Court's decision in the case of Principal Commissioner Vs Essar Oil Ltd supports the allowance of such credit. The Tribunal concurs with this view and holds that the Service Tax paid on rent-a-cab services is admissible for credit. Consequently, the impugned Orders are set aside, and the appeals are allowed with consequential relief as per the law. In conclusion, the judgment clarifies the admissibility of CENVAT Credit for 'Courier Services' and rent-a-cab services, emphasizing the nexus of these services with manufacturing activities and business operations. The decision provides a comprehensive analysis of the legal provisions and precedents to support the allowance of such credits, ensuring compliance with the applicable laws and regulations in the realm of Central Excise, Customs, and Service Tax.
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