2018 (11) TMI 1447 - AT - Central Excise

CENVAT Credit - input services - Supply of Security Personnel deputed along with the goods to various customer sites - Supply of Manpower for Gardening and Housekeeping - denial on account of nexus - Held that - The issue relating to supply of Manpower for Housekeeping and Landscaping were held to be eligible input services by the jurisdictional High Court in the case of Wipro Ltd. vs. Commissioner of C. Ex., Pondicherry 2017 (5) TMI 188 - MADRAS HIGH COURT - credit allowed. Supply of Security Personnel deputed along with goods to the customer s sites - Held that - The same was very much essential since the value of the equipment/goods was very high and the supply depended on timely delivery - When the Manpower is used for Gardening and Housekeeping, Security Personnel/Watchmen engaged in overall security of their business premises could be held to be eligible, the same logic should equally apply to the same personnel being engaged for the services related to the appellant s business and in assisting safe delivery - credit allowed. Appeal allowed - decided in favor of appellant.

Summary

Issues involved:
1. Eligibility of CENVAT Credit on services availed by the appellants.
2. Supply of Security Personnel and its nexus with the manufacture of excisable goods.

Analysis:
Issue 1: The appellants availed CENVAT Credit for services of Security Personnel and Manpower for Gardening and Housekeeping. A Show Cause Notice was issued proposing a demand under Rule 14 of the CENVAT Credit Rules, 2004. The lower adjudicating authority confirmed the demand, interest, and imposed a penalty. The Commissioner of G.S.T. & Central Excise rejected the appeal. The appellant appealed to the forum. The Advocate cited a High Court judgment holding services as eligible input services. The AR supported the lower authorities. The Member analyzed the High Court judgment and found it applicable to the present case. The judgment emphasized the broad definition of input services and the relevance of maintaining factory premises. The Member ruled in favor of the appellant for both Manpower for Gardening and Housekeeping services.

Issue 2: The Member considered the argument regarding the Supply of Security Personnel essential for timely delivery of high-value goods. Drawing parallels with the eligibility of Manpower for Gardening and Housekeeping, the Member concluded that Security Personnel engaged in ensuring safe delivery should also be considered eligible. The Member found the impugned Order unsustainable and set it aside, allowing the appeal with consequential benefits.

In conclusion, the judgment upheld the eligibility of CENVAT Credit for services of Manpower for Gardening, Housekeeping, and Security Personnel, emphasizing the importance of maintaining factory premises and ensuring safe delivery of goods. The Order-in-Original was set aside, and the appeal was allowed with consequential benefits.