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2017 (9) TMI 862 - AT - Central ExciseCENVAT credit - amendment in definition of input service w.e.f. 01.4.2011 - Courier Service - whether the Respondents are eligible to CENVAT credit of the Service Tax paid on Courier Services? - Held that - though the expression activities relating to business, such as has been deleted, but the illustrative services viz., Accounting, Auditing, Financing, Recruitment and quality control, Coaching/training, Computer Networking, Credit Rating, Share Registry, Legal Services, Security, Business Exhibition etc., even though directly not related to manufacturing activity, being not used inside the factory premises, but continued to remain in the said definition of input service - It cannot be denied that Courier Service involves a host of uses relating to the activity of manufacture and sale of goods. Tribunal in the cases of M/s Lifelong Meditech Ltd. Versus CCE & ST, Gurgaon-II 2016 (7) TMI 468 - CESTAT CHANDIGARH opined that Service Tax paid on Courier Serves is eligible to Cenvat Credit - Service Tax paid on the Courier Services for various purposes viz., Sending Samples, Documents, finished goods etc., would be eligible to Cenvat Credit before and even after amendment to the definition to the Input Services with effect from 01.4.2011 - appeal dismissed - decided against Revenue.
Issues involved:
Admissibility of CENVAT Credit of Service Tax paid on Courier Service prior to and after 01.4.2011. Analysis: Issue 1: Admissibility of CENVAT Credit of Service Tax paid on Courier Service The appeal concerns the admissibility of CENVAT Credit of Service Tax paid on Courier Service before and after 01.4.2011. The Respondent, a manufacturer of excisable goods, used Courier Services for sending samples, documents, and finished goods. The Ld Advocate argued that even before 01.4.2011, credit of service tax paid on Courier Services for dispatching finished goods was considered admissible by the Hon'ble Gujarat High Court. Post the amendment to the definition of Input Services from 01.4.2011, the Ld Advocate contended that the credit on Service Tax paid on such services remains admissible as they are integrally connected to the manufacturing activity. The Ld Advocate cited cases where the Tribunal ruled in favor of assessees regarding the eligibility of CENVAT Credit for Courier Services. On the contrary, the Ld AR for the Revenue argued that Courier Services are not directly related to manufacturing activity post the 2011 amendment. The Tribunal analyzed the amended definition of Input Service and noted that certain services indirectly related to manufacturing activity but connected to the business of manufacturing remained eligible for credit. The Tribunal concluded that Courier Services for sending samples, documents, and finished goods are eligible for CENVAT Credit both before and after the 2011 amendment. The impugned Order was upheld, and the Revenue's appeal was dismissed. In conclusion, the Tribunal ruled in favor of the Respondent, holding that Service Tax paid on Courier Services is eligible for CENVAT Credit for various purposes such as sending samples, documents, and finished goods, both before and after the amendment to the definition of Input Services from 01.4.2011.
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