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2017 (10) TMI 186 - AT - Central ExciseCENVAT credit - Courier Service pertaining to the period prior to 01.4.2011 - definition of Input Service prescribed at Rule 2(l) of CCR, 2004 with effect from 01.4.2011 - Held that - The present appellants are manufacturer of excisable goods and utilized the Courier Services in sending the Samples, Documents and Finished Goods to their customers - A simple reading of the said amended provision, makes it clear 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. Needless to mention that these services are even though not directly linked to the manufacturing activity in the factory premises of the assessee but connected or related to the business of manufacturing activity which also involve marketing/sale of the manufactured goods - credit allowed. CENVAT credit - CHA service - C&F Services - Held that - The appellants had also availed credit of the service tax paid on CHA and C&F Services which held to be admissible by the Hon ble Gujarat High Court in the case of Commissioner Vs. Dynamic Industries 2014 (8) TMI 713 - GUJARAT HIGH COURT and CCE, Ahmedabad Vs Cadila Healthcare Ltd 2013 (1) TMI 304 - GUJARAT HIGH COURT respectively. Appeal allowed - decided in favor of appellant.
Issues involved:
Admissibility of CENVAT Credit for Service Tax paid on 'Courier Services', CHA service, and C&F service. Analysis: 1. The appeals raised the issue of whether CENVAT Credit for Service Tax paid on 'Courier Services' is admissible. The appellants, who are manufacturers of excisable goods, argued that the 'Courier Services' were essential for sending samples, documents, and finished goods to customers. They cited precedents where the Gujarat High Court and the Tribunal had ruled in favor of admissibility of such credit. The appellants contended that even after amendments to the definition of 'Input Services' from 01.4.2011, the credit for Service Tax on 'Courier Services' should be allowed as they are integral to manufacturing activities and business operations. 2. The Tribunal analyzed the amended definition of 'Input Service' post-01.4.2011, which excluded the expression 'activities relating to business.' However, the Tribunal noted that services like Accounting, Auditing, Financing, Recruitment, etc., which are not directly linked to manufacturing but are part of business operations, remained eligible for credit. The Tribunal emphasized that 'Courier Services' play a crucial role in various aspects of manufacturing and sales activities, such as sending technical reports, samples, and catalogs. Relying on previous judgments, the Tribunal concluded that credit for Service Tax on 'Courier Services' is admissible. 3. Additionally, the appellants had claimed credit for Service Tax paid on CHA and C&F Services. The Tribunal referred to judgments by the Gujarat High Court, which upheld the admissibility of such credits. The Revenue argued that 'Courier Services' should not be considered under 'Input Services' post-amendments. However, the Tribunal disagreed, stating that these services are integral to business activities and thus eligible for credit. The Tribunal allowed the appeals, setting aside the impugned orders and granting consequential relief as per the law. In conclusion, the Tribunal ruled in favor of the appellants, holding that the Service Tax paid on 'Courier Services' for sending samples, documents, and finished goods, even after the amendment to the definition of 'Input Services,' is admissible for CENVAT credit. Similarly, the Service Tax paid on CHA and C&F Services was deemed eligible for credit. The Tribunal's decision favored the appellants, allowing their appeals and providing relief accordingly.
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