2017 (12) TMI 1183 - AT - Central Excise

CENVAT credit - input services - whether the appellant is entitle for the Cenvat credit in respect of services namely Hotel accommodation service, rent a cab service, tour operator service and membership of club service? Held that - as per the nature of the service there is no dispute that it is used in the overall functioning of the appellant s business - On all these services this tribunal time and again decided that these services are input service and Cenvat credit is admissible. As regard the Cenvat credit in respect of rent a cab service on or after 1-4-2011 as per the amended rule 2(l) of Cenvat credit rules, credit on rent a cab service is not admissible - demand of Cenvat credit on rent a cab service from 1-4-2011 onwards is upheld. Appeal allowed in part.

Summary

Issues:
Whether the appellant is entitled to Cenvat credit for services like hotel accommodation, rent-a-cab, tour operator, and membership of club.

Analysis:
The appellant's representative, Shri. Mehul Jiwani, acknowledged the denial of credit for rent-a-cab service from 1-4-2011 due to an amendment in the definition of input service. However, he argued in favor of Cenvat credit for hotel accommodation service used for official purposes, tour operator service for employee transportation to the factory, and membership of club service for staff knowledge enhancement. Various judgments were cited to support the admissibility of credit for these services.

The Revenue's representative, Shri. S.V. Nair, reiterated the findings of the impugned order during the proceedings.

The tribunal carefully considered both sides' submissions and the records. It was noted that the services in question were integral to the overall functioning of the appellant's business. Previous tribunal decisions were cited to support the admissibility of Cenvat credit for these services, emphasizing their classification as input services.

In light of the settled legal position, the tribunal concluded that credit is admissible for all the services in question except for rent-a-cab service post 1-4-2011 due to the amended rule. Consequently, the demand for Cenvat credit on rent-a-cab service from 1-4-2011 onwards was upheld, while the remaining demand and penalty were set aside. The appeal was partly allowed based on these findings.