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2019 (3) TMI 1085 - AT - Central ExciseCENVAT Credit - input services - Services used for Maintenance of Residential Colony which is Industrial Township - period March, 2009 to October, 2009 - Held that - The issue decided in appellant own case M/S HINDALCO INDUSTRIES LTD. VERSUS COMMISSIONER, CENTRAL EXCISE, ALLAHABAD 2018 (12) TMI 1624 - CESTAT ALLAHABAD , where it was held that all the input services in question incurred for the upkeep and maintenance of the colony is an essential business expenditure and accordingly, Cenvat Credit is allowable under the provisions of Rule 2(l) of the Cenvat credit rules, 2004 - credit allowed - appeal allowed - decided in favor of appellant.
Issues involved: Admissibility of Cenvat Credit for Service Tax paid on Input Services used for 'Maintenance of Residential Colony' in an Industrial Township for a manufacturing unit.
Analysis: The judgment by the Appellate Tribunal CESTAT ALLAHABAD, delivered by Mr. Anil G. Shakkarwar, Member (Technical), revolved around the issue of whether Service Tax paid on various Input Services utilized for the 'Maintenance of Residential Colony' linked to an Industrial Township could be considered admissible as Cenvat Credit for an appellant engaged in manufacturing aluminum. The Tribunal noted that both sides agreed that the issue had been previously decided by the Tribunal for a period from November 2009 to March 2010 through Final Order No. 72929/2018 dated 27.12.2018, which was based on another Final Order No. 70344/2017 dated 03.04.2017. The specific period under consideration in the present dispute was from March 2009 to October 2009. The Tribunal referred to a previous Final Order dated 03.04.2017, where it was established that appellants were entitled to Cenvat Credit of Service Tax paid on Input Services used for the Maintenance of Residential Colony connected to the manufacturing unit. The Tribunal highlighted that the maintenance of the residential colony was crucial for the manufacturing process as it required a large number of trained personnel available in the vicinity of the factory due to continuous operations in shifts. Therefore, the construction, maintenance, and municipal services in such an industrial township were deemed essential business expenditures, making the Cenvat Credit allowable under the Cenvat Credit Rules, 2004. The Tribunal also referenced a Division Bench decision in the case of Reliance Industries Ltd. vs. CCE & ST (LTU), Mumbai, to support the allowance of Cenvat Credit in such scenarios. Consequently, the Tribunal set aside the impugned order and allowed the appeal with consequential relief, affirming the admissibility of Cenvat Credit for Service Tax paid on Input Services utilized for the 'Maintenance of Residential Colony' in an Industrial Township related to the manufacturing unit.
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