2018 (12) TMI 438 - AT - Service Tax

CENVAT Credit - various input services - denial on account of nexus - Air Travel Agent / Rail travel Agent Services - Cable operator services - Convention service - Membership service - Erection commission/installation service - Civil works services/Repairs and maintenance - Designing and printing services - Cleaning services/Housekeeping - Sponsorship services - Finance Lease services - Accommodation services. Air travel agent / rail travel agency service - cable operator service - convention service - erection, commission and installation service - designing and printing service - cleaning service / housekeeping - sponsorship service - finance lease service - Held that - The credit availed on air travel agent / rail travel agency service, cable operator service, convention service, erection, commission and installation service, designing and printing service, cleaning service / housekeeping, sponsorship service and finance lease service are eligible for credit - These issues were considered by the Tribunal in Xilinx India Tech. Services Pvt. Ltd. Vs CC., CE. & ST., Hyderabad-IV 2017 (1) TMI 658 - CESTAT HYDERABAD - credit allowed. Membership fees - Held that - In CCE, Pune III vs Zensar Technologies Ltd 2015 (11) TMI 1561 - CESTAT MUMBAI the said services were held to be eligible - These services therefore cannot be said to be for personal consumption - credit allowed. Civil works / repairs and maintenance - Held that - It is not possible to make out from the SCN or the order as to the services which come under works contract service and civil works services. This aspect needs to be reconsidered - matter on remand. Accommodation services - Held that - The appellant has to establish with necessary documents that the accommodation was availed for official purposes only. The Counsel for appellant submitted that the appellant would be able to furnish documents to establish that this was availed for official purposes only - the accommodation service also requires to be remanded to the adjudicating authority - matter on remand. Appeal allowed in part and part matter on remand.

Summary

Issues: Disallowance of Cenvat Credit on various services.

The appellant contested the denial of credit by the department, arguing that the services were directly or indirectly related to the manufacturing process. The advocate provided a detailed list of services availed, their purposes, and relevant decisions supporting their eligibility. The Tribunal reviewed the submissions and records and determined that credits for specific services like air travel, cable operators, convention services, erection commission, designing and printing, cleaning services, sponsorship, and finance lease were eligible based on precedents like Xilinx India Tech. The disallowance was deemed unjustified and set aside.

Regarding membership services, the appellant justified the need for memberships in business-related organizations to enhance business connections and stay updated with industry trends. Citing the case of CCE, Pune III vs Zensar Technologies Ltd, the Tribunal agreed that these memberships were not for personal consumption and allowed the credit.

For civil works and maintenance services, the appellant clarified that charges included in the Annual Maintenance Contract were for xerox machines used in the factory. However, due to ambiguity in distinguishing between works contract services and civil works services in the records, this issue was remanded for further review.

Similarly, the Tribunal remanded the issue of accommodation services for employees on official duty to establish the official purpose of the accommodation. The services related to civil works, repair and maintenance, and accommodation were remanded for fresh adjudication, while credit for other services was allowed. The appeal was partly allowed and partly remanded for further consideration by the adjudicating authority.