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2021 (8) TMI 875 - AT - Service TaxCENVAT Credit - input services - Mandap Keeper Service - Real Estate Agent Services - Works Contract Service - Event Management Services - Facility Management Services - HELD THAT - Originally show-cause notice proposing to demand service tax of ₹ 1,43,53,520/- was issued. After verification by the Additional Commissioner, cenvat credit of ₹ 1,08,18,980/- was allowed and cenvat credit of ₹ 32,57,563/- was held to be ineligible and demanded along with interest and penalty. The cenvat credit on input services are in fact relating to the business activity of the appellant and are covered by the definition of input service under Rule 2(l) of the Cenvat Credit Rules, 2004. Though in some of the invoices, the nature of service mentioned is different but the classification shown in the invoice is different but this kind of a discrepancy will not disentitle the appellant to claim cenvat credit once the input service is used for the business activity of the appellant. In some invoices, the nature of service mentioned is different but the classification as per the invoice is different but definitely all these services have been used by the appellant for rendering output service. Various decisions relied upon by the appellant have categorically held these services to be an input services . These services fall in the definition of input service and the appellant has rightly claimed the CENVAT credit - appeal allowed - decided in favor of appellant.
Issues:
Cenvat credit denial on input services - Mandap Keeper Service, Real Estate Agent Services, Works Contract Service, Event Management Services, Facility Management Services. Analysis: The appellant, engaged in taxable services, availed cenvat credit on various input services for the period April 2015 to June 2017. A show-cause notice was issued proposing recovery of ineligible cenvat credit. The Additional Commissioner rejected and demanded cenvat credit on certain input services. The Commissioner partly allowed cenvat credit and rejected ?18,75,083 on five input services, leading to the present appeal. Mandap Keeper Service: The appellant argued that Mandap Keeper Service is an input service essential for employee welfare and output services, citing relevant case laws. The service is used for official functions and employee gatherings. The appellant's refund claim for this service was partially granted by the lower authority. Real Estate Agent Services: The appellant justified availing Real Estate Agent Services for business premises setup, supported by a relevant case law. The service is crucial for obtaining office premises and is directly linked to the services provided. Works Contract Services: Works Contract Services were deemed necessary for asset maintenance and business operations, as per the appellant. The service includes finishing, repair, and restoration activities, essential for the output services provided. Event Management Services: Event Management Services were argued to be crucial for business promotion, team building, and employee motivation, leading to company growth. The service is considered an input service based on its impact on employee development and company progress. Facility Management Services: Facility Management Services, including housekeeping for premises upkeep, were highlighted as crucial for providing exported services and related to the business. The appellant's claim was supported by a relevant decision. The appellant emphasized the widened scope of 'input service' post-April 2011, stating that a direct correlation with output services is not necessary. The appellant provided detailed documentation, including invoices and service classifications, to support the claim. The appellant's arguments were based on legal precedents and the essential nature of the input services for business operations. The Commissioner, after reviewing the submissions and case laws cited by the appellant, concluded that the disputed input services indeed fell under the definition of 'input service.' The discrepancies in some invoices did not disqualify the appellant from claiming cenvat credit, as long as the services were utilized for business activities. The appeal was allowed, subject to invoice verification for the disputed period, and the appellant's claim for cenvat credit on the input services was upheld. The judgment was pronounced in open court on 19/08/2021.
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