2018 (3) TMI 1052 - AT - Central Excise

CENVAT credit - input services - outdoor catering service - Employees transport service - Hotel stay charges and travel agent charges - Construction service - Held that - service tax paid on outdoor catering service (canteen service), extended to the employees is eligible to credit in view of the judgment of the Hon ble Gujarat High Court in Ferromatik Milacron India Ltd. s case 2010 (4) TMI 649 - GUJARAT HIGH COURT - credit allowed. Employees transport service - Held that - the matter is remanded to the adjudicating authority to scrutinize the evidences in the light of the changes in law and its applicability to the facts of the present case. Hotel stay charges - travel agent charges incurred by the appellant in relation to sales/marketing of their product Held that - services is admissible to credit in view of the judgment of this Tribunal in Honda Motorcycle s case 2016 (8) TMI 308 - CESTAT CHANDIGARH - credit allowed. Construction service - Held that - the Ld. Commissioner(Appeals) has already remanded the matter to the adjudicating authority, hence, the said issue for the earlier period is also remanded to the adjudicating authority for verification. Further the appellant had availed credit of ₹ 2,53,452/- but could not explain it properly before the authorities below against on which particular input service it was availed. The Ld. Advocate claims that now they are in possession of documents accordingly, they could establish the eligibility of the credit of the service tax paid on various services. Thus, this issue is also remanded to the adjudicating authority. Appeal allowed by way of remand.

Summary

Issues:
- Admissibility of cenvat credit on various input services
- Eligibility of credit on Outdoor Catering Service, Employee Transportation Service, Epoxy Flooring Service, Travel Agent Service, Hotel Charges, Maintenance & Repair Service
- Dispute over the amount of credit availed and rejected
- Remand of certain issues to the adjudicating authority for further scrutiny

Analysis:

The appeal was filed against the order-in-appeal passed by the Commissioner of Central Excise (Appeals-II) Ahmedabad regarding the admissibility of cenvat credit on various input services availed by the appellants. The appellants, engaged in the manufacture of excisable goods, had availed cenvat credit on services like Outdoor Catering Service, Employee Transportation Service, Epoxy Flooring Service, Travel Agent Service, Hotel Charges, and Maintenance & Repair Service during the period April 2010 to June 2013. The adjudicating authority allowed a partial credit of &8377; 17,58,214 out of the total credit of &8377; 44,27,684 claimed, leading to an appeal before the Ld. Commissioner (Appeals) who further allowed a partial credit of &8377; 63,714 and remanded the scrutiny of credit of &8377; 14,21,177 on construction service to the Adjudicating Authority. The present appeal challenged the rejection of the remaining balance amount of &8377; 11,84,580.

The appellant's advocate argued for the eligibility of credit on various services based on legal precedents and interpretations. The advocate contended that certain credits, such as those related to Outdoor Catering Service, Employee Transportation Service, Hotel Charges, Travel Agent Service, and Construction Service, were admissible as per relevant judgments and should be reconsidered. The advocate also mentioned discrepancies in the explanation of certain credit amounts and requested a remand to produce additional evidence for their eligibility.

The Revenue's representative supported the findings of the Ld. Commissioner (Appeals) and had no objection to remanding certain matters for further verification. After hearing both sides and examining the records, the Member (Judicial) found merit in the appellant's arguments regarding the eligibility of credit on specific services. The Member highlighted that the Outdoor Catering Service credit was eligible based on a judgment of the Hon'ble Gujarat High Court. The matter concerning Employee Transportation Service was remanded for a detailed scrutiny of facts in light of legal changes. Similarly, credits related to Hotel stay charges, Travel Agent charges, and Construction Service were deemed admissible based on relevant legal precedents. The issue of unexplained credit availed by the appellant was also remanded to allow for the submission of additional evidence.

In conclusion, the impugned order was modified, and the appeal was disposed of by remanding the case to the adjudicating authority for a thorough review based on the observations made during the hearing. The judgment emphasized the importance of legal interpretations and the need for detailed scrutiny of facts in determining the admissibility of cenvat credit on various input services.