9911796707
|
Home
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2018 (2) TMI 380 - AT - Central ExciseCENVAT credit - input services - outward catering service - denial on the premise that the same is covered under exclusion class of Rule 2(l) of CCR 2004 - Held that - Admittedly, it has not been disputed by the authorities below that the outdoor catering service in question has been provided by the appellant to the employees in the factory in terms of section 46 of the Factories Act, 1948 wherein the appellant is required to provide canteen service to the employee mandatorily - CENVAT credit cannot be denied to the appellant in terms of the decision of this Tribunal in the case of Hindustan Coca Beverages Pvt. Limited 2016 (8) TMI 35 - CESTAT HYDERABAD , where it was held that outdoor catering services are used by appellant in relation to the business of manufacture and not for any personal use or consumption of employee and credit allowed - appeal allowed - decided in favor of appellant.
Issues:
Appeal against disallowance of CENVAT credit for outward catering service under Rule 2(l) of Cenvat Credit Rules, 2004. Analysis: The appellant appealed against the disallowance of CENVAT credit for outward catering service, claiming entitlement to the credit. The issue revolved around the interpretation of Rule 2(l) of Cenvat Credit Rules, 2004, specifically focusing on the exclusion clause related to outdoor catering services. The rule excludes services primarily used for personal consumption of employees from being eligible for CENVAT credit. The appellant contended that the outdoor catering service provided was mandatory under the Factories Act, 1948, and not primarily for personal use or consumption of employees. The Tribunal referred to previous judgments, including Hindustan Coca Beverages Pvt. Limited, to support the appellant's argument that services mandated by law for the welfare of employees should not be denied CENVAT credit. The Tribunal emphasized that outdoor catering services were crucial for the business of manufacture and not for personal use, leading to the conclusion that CENVAT credit should not be denied. In the detailed analysis, the Tribunal examined the impugned order and noted that the outdoor catering service provided by the appellant was mandatory under the Factories Act, 1948, for the welfare of employees. The authorities did not dispute this fact. Referring to the decision in Hindustan Coca Beverages Pvt. Limited, the Tribunal highlighted that services like outdoor catering, when mandated by law and not primarily for personal use, should not be excluded from CENVAT credit. The Tribunal emphasized that compliance with the Factories Act was essential for the appellant's manufacturing activities, indicating that the outdoor catering service was integral to the business operations and not for personal consumption. Consequently, the Tribunal set aside the impugned order that denied CENVAT credit for outdoor catering service post 01.04.2011 and allowed the appeal with any consequential relief. Therefore, the judgment focused on the interpretation of Rule 2(l) of Cenvat Credit Rules, 2004 concerning the exclusion of outdoor catering services from CENVAT credit eligibility. The decision underscored the importance of statutory compliance and the business necessity of such services in determining their eligibility for credit, ultimately ruling in favor of the appellant and allowing the appeal against the disallowance of CENVAT credit for outward catering service.
|
