2017 (9) TMI 410 - AT - Service Tax

CENVAT credit - canteen services - medical treatment expenses - penalty - Held that - The appellant has asserted that the service provider is registered as outdoor caterer with Service Tax Department and has paid service tax as is apparent from the bill. In these circumstances, the service provided has to be treated as outdoor catering service and credit allowed. Workman injured in the factory - medical treatment expenses - Held that - It is seen that the appellant has not produced any evidence to the lower authorities or to the Tribunal to the effect that the person treated was indeed a workman and not somebody else. In absence of evidence, credit of the same cannot be allowed. Penalty - Held that - the amounts are very small and there is no specific evidence of any suppression or mala fides of the appellant. In these circumstances, invoking Section 80, the penalties are set aside. Appeal allowed - decided partly in favor of appellant.

Summary

Issues:
1. Denial of cenvat credit on canteen services and medical treatment expenses.
2. Contesting imposition of penalty on demands other than canteen services and medical treatment expenses.

Analysis:
1. The appellant, M/s. Balkrishna Industries, appealed against the denial of cenvat credit on specific services, mainly focusing on canteen services and medical treatment expenses. The Commissioner (Appeals) disallowed credit for invoices from M/s. Hari Om Canteen Services, citing multiple charges like gas, housekeeping mandes, and service charges. However, the appellant argued that the caterer issued an itemized bill for outdoor catering services, paying service tax accordingly. The appellant contended that since the caterer was registered for outdoor catering, credit could not be denied. The Tribunal examined the caterer's invoice, noting the itemized billing and the caterer's registration, concluding that the service should be considered outdoor catering, thereby allowing the credit.

2. Regarding the medical treatment expenses, the original adjudicating authority and the Commissioner (Appeals) rejected the credit due to lack of evidence linking the injured person to the manufacturing activity. The appellant claimed that the injured individual was a factory workman, directly connecting the expense to manufacturing. However, as no evidence was presented to substantiate this claim, the Tribunal upheld the denial of credit for the medical treatment expenses.

3. In terms of penalties, the appellant argued against their imposition. The Tribunal considered the small amounts involved and the absence of evidence indicating suppression or mala fides by the appellant. Consequently, invoking Section 80, the Tribunal set aside the penalties but noted that the appellant remained liable for interest as per the law.

4. Ultimately, the Tribunal partially allowed the appeal, granting relief on the canteen services and penalties while upholding the denial of credit for medical treatment expenses. The judgment was pronounced on 9th August 2017.