2018 (1) TMI 3 - AT - Central Excise

CENVAT credit - input service - rent-a-cab service - period involved is July, 2013 to July, 2014 - Held that - As per the amendment of definition of input service under rule 2(l) clause (B) rent a cab service falling under clause (zo) has been excluded from the purview of input service - Since there is categorical exclusion of rent a cab from the definition of input service credit on or after 1-4-2011, credit is not admissible - appeal dismissed - decided against appellant.

Summary

Issues:
- Entitlement to Cenvat credit for rent a cab service from July 2013 to July 2014.

Analysis:
The issue before the Appellate Tribunal was whether the appellant is entitled to the Cenvat credit for rent a cab service for the period between July 2013 to July 2014. The appellant argued that the service they received did not fall under the rent a cab service category as they had hired a 24-seater vehicle, which, according to them, did not meet the definition of "Cab" as per Section 65(91) of the Finance Act, 1994. The consultant for the appellant contended that since the vehicle hired was not a cab, the hiring of the vehicle should be considered an admissible input service, and the credit should not be denied.

The Revenue, represented by the Superintendent (A.R.), countered the appellant's argument by referring to Notification No. 3/11 CE(N.T.) dated 1-3-2011, which amended the definition of input service under Rule 2(l) of the Cenvat Credit Rules, 2004. The Revenue pointed out that as per the amendment, rent a cab service fell under clause (zo) and was excluded from the purview of input service. Citing the case of Orient Paper Mills Vs Commissioner of Central Excise, Bhopal [2016(46)S.T.R. 854(Tri. Del.)], the Revenue argued that the appellant was not eligible for Cenvat credit on rent a cab service from 1-4-2011 onwards.

After considering the arguments from both sides and examining the records, the Tribunal noted that the definition of input service had been amended to exclude rent a cab service falling under clause (zo) from the purview of input service. The Tribunal also referred to the decision in the case of Orient Paper Mills to support this exclusion. The Tribunal rejected the appellant's argument that the service received did not qualify as rent a cab service due to the type of vehicle hired, as the service provider had classified it as such and paid service tax accordingly. Therefore, the appellant could not challenge this classification. Consequently, the Tribunal upheld the impugned order, stating that since rent a cab service was categorically excluded from the definition of input service from 1-4-2011, the appellant was not entitled to the credit. As a result, the appeal was dismissed.