2019 (1) TMI 169 - AT - Central Excise

CENVAT Credit - input services - car repairing services - outdoor catering services - Held that - The Ld. Advocate is correct in her assertion that there was no restriction or bar in the definition of input services in Rule 2 (l) ibid prior to 1.4.2011 - a number of Tribunal decisions have consistently upheld the eligibility of such input credits prior to 1.4.2011 - reliance placed in the case of M/S. SCOPE INTERNATIONAL PVT. LTD. VERSUS THE COMMISSIONER OF CENTRAL EXCISE, CHENNAI 2018 (7) TMI 1007 - CESTAT CHENNAI - credit allowed - appeal allowed - decided in favor of appellant.

Summary

Issues: Dispute regarding availing cenvat credit on input services including outward transportation, car hiring, car repairing, and outdoor catering services prior to 1.4.2011.

Analysis:
The case involved three appeals by the same appellant concerning the availing of cenvat credit on various input services, namely outward transportation, car hiring, car repairing, and outdoor catering services. The Department contended that the appellants were not eligible to claim cenvat credit on these services. Show cause notices were issued proposing recovery of the credit amounts availed, along with interest and penalties under relevant laws. The dispute spanned different periods from Feb 2009 to March 2011, with specific amounts availed and denied credit detailed in the proceedings.

The appeals were initially rejected by the Commissioner (Appeals), leading to the matter being brought before the Tribunal. During the hearing, the appellant's representative argued that the input services in question were availed before 1.4.2011, prior to changes in the definition of 'input services' under Rule 2(l) of the CCR 2004. It was emphasized that before this date, there were no restrictions on availing input credits for services like canteen, car hire, and several Tribunal decisions supported this position.

The Assistant Commissioner representing the Department supported the impugned order, setting the stage for the Tribunal's decision. After considering both arguments and reviewing the facts, the Tribunal Member noted that the dispute primarily centered around car repair and canteen services. It was observed that prior to 1.4.2011, there were no restrictions in the definition of 'input services,' as highlighted by the appellant's representative and supported by relevant case laws. Consequently, the Tribunal held that the impugned orders were unsustainable and set them aside, allowing the appeals with any consequential benefits as per the law.

In conclusion, the Tribunal's decision favored the appellant, emphasizing the absence of restrictions on availing cenvat credit on certain input services before 1.4.2011. The judgment highlighted the importance of the pre-amendment regulatory framework and relevant case laws in determining the eligibility of the appellant to claim the disputed credits, ultimately leading to the allowance of the appeals and setting aside of the previous orders.