2018 (1) TMI 201 - AT - Central Excise

CENVAT credit - courier service used by them for despatch of documents - place of removal - input service - Held that - In so far as the movement of goods from factory to depot is concerned, the appellants have clarified that depot is the place of removal as the goods are moved from factory only on stock transfer basis and sale takes place only from depot. In these circumstances, the credit of service of courier from factory to depot cannot be denied - credit allowed. CENVAT credit - air travel/ rail travel - tour operator service - Held that - The appellants have clarified that the said services were used exclusively for official work and not to LTC. The appellants have agreed to produce necessary document before the original adjudicating authority to establish the said nexus - matter on remand. CENVAT credit - service in respect of Advertising Standard Council of India - Held that - advertising is related to business permission and therefore would be included in the inclusive part of the service. The cenvat credit of service availed in respect of membership of Advertising Standard Council of India is allowed - credit allowed. CENVAT credit - input services - outdoor catering service availed in respect of canteen facility - Held that - they have more than 250 employees and maintaining canteen is obligatory as per law - reliance placed in the case of Ultratech Cement Ltd. 2016 (12) TMI 381 - CESTAT HYDERABAD - credit allowed. Appeal allowed in part - part matter on remand.

Summary

Issues:
1. Denial of cenvat credit for courier service
2. Denial of credit for air travel, rail travel, and tour operator service
3. Service tax credit on club and association service
4. Cenvat credit on input services for outdoor catering service

Analysis:
1. The appellant, Hawkins Cookers Ltd., appealed against the denial of cenvat credit for courier services used for document dispatch. The appellant argued that goods were sold at the depot, which was the place of removal, and cited relevant legal precedents. The Tribunal found merit in the argument, stating that the courier service was related to the manufacture of finished goods. The appeal succeeded in obtaining credit for the courier service used between the factory and depot.

2. The denial of credit for air travel, rail travel, and tour operator services was challenged by the appellant, claiming these services were used exclusively for official work, not for LTC purposes. The Tribunal set aside the demand for this service and remanded the matter to verify the nexus with official work, directing the original adjudicating authority to re-examine the issue.

3. Regarding service tax credit on club and association services, the appellant sought credit for the service related to the "Advertising Standard Council of India." The Tribunal allowed the credit for this service, considering it business-related. However, credit for services related to other clubs was not pressed by the appellant and was upheld.

4. The appellant claimed cenvat credit on input services for outdoor catering services provided in the canteen, citing the obligation to maintain a canteen due to having over 250 employees. The Tribunal allowed the appeal, noting that credit was claimed only for the portion of the service not recovered from employees, in line with legal precedents. The decision relied on the Tribunal's rulings in similar cases involving Ultratech Cement Ltd. and Hindustan Coca Cola Beverages Pvt. Ltd.

In conclusion, the appeal was partly allowed, with the issue of credit for air/rail travel and tour operator services remanded for further verification and fresh orders by the original adjudicating authority. The judgment was pronounced on 29/11/17.