2010 (5) TMI 211 - AT - Service Tax

Cenvat Credit- The issue involved in this case is whether the appellants are entitled for availment of CENVAT credit on garden maintenance service and repairs of deep freezer installed in canteen. Held that-in the light of the decisions ISMT Ltd 2010 -TMI - 76050 - CESTAT, MUMBAI and SEMCO Electrical Pvt. Ltd.2010 -TMI - 76184 - CESTAT, MUMBAI, allow the appeal.

Summary

Issues:
Entitlement of CENVAT credit on garden maintenance service and repairs of deep freezer installed in canteen.

Analysis:
The issue in this case revolves around the entitlement of the appellants to avail CENVAT credit on garden maintenance service and repairs of a deep freezer in the canteen. The appellant's advocate argued that previous Tribunal decisions in the cases of ISMT Ltd. and SEMCO Electrical Pvt. Ltd. supported the appellant's entitlement to the credit as the services were used in relation to the business activity. Therefore, the advocate requested the appeal to be allowed based on these precedents.

On the contrary, the learned SDR contended that there were conflicting decisions by the Tribunal on this issue and proposed referring the matter to the Larger Bench for consideration. The SDR specifically mentioned cases like Kirloskar Oil Engines Ltd., Vikram Ispat, and ManikGarh Cement as having taken a different view. However, upon examination, the Member (Judicial) found that the decision in the case of Kirloskar Oil Engines Ltd. had been set aside by the Hon'ble Bombay High Court and remanded back to the Tribunal. The decision in the case of Vikram Ispat followed the Kirloskar Oil Engines Ltd. case, making it irrelevant. The Member also noted that the facts of the Manikgarh Cement case were dissimilar to the current case and, therefore, not applicable.

After considering the arguments and precedents, the Member concluded that the issue was already settled in favor of the appellant based on the decisions in the cases of SEMCO Electrical Pvt. Ltd. and ISMT Ltd. The Member found no need to refer the matter to the Larger Bench as there was no contrary decision that would warrant such a referral. Consequently, the impugned order was set aside, and the appeal was allowed in favor of the appellant.

In summary, the judgment clarified the entitlement of the appellants to CENVAT credit on specific services, relying on established precedents and distinguishing conflicting decisions to support the conclusion reached by the Member (Judicial) without the need for a reference to the Larger Bench.