2012 (6) TMI 221 - AT - Central Excise

Cenvat credit - Rent-a-Cab service utilised for the purpose of transportation of employees to the place of work and vice-versa Held that - As decided in Commissioner of Central Excise, Bangalore-III, Commissionerate v. Stanzen Toyotetsu India (P.) Ltd. 2011 (4) TMI 201 (HC) that any service used by the manufacturer whether directly or indirectly in or in relation to the manufacture of final products constitutes input service and the catering service, rent-a-cab and transportation services and the tax paid on the said services are stated as input services - substantial question of law framed answered in favour of the assessee.

Summary

Issues involved:
1. Availment of cenvat credit on service tax paid for Rent-a-Cab service.

Analysis:

Issue 1: Availment of cenvat credit on service tax paid for Rent-a-Cab service
The appeal was filed against an order dated 30.08.2010 regarding the availment of cenvat credit on service tax paid for Rent-a-Cab service used by the respondent for employee transportation. The counsel referred to a judgment by the Hon'ble High Court of Karnataka in a similar case involving service tax credit on Rent-a-Cab service and Outdoor Catering services. The High Court held that services used directly or indirectly in relation to manufacturing final products constitute input services, including catering service, rent-a-cab, and transportation services. The judgment favored the assessee, concluding that the tax paid on such services qualifies as input services. Based on this precedent, the Tribunal found the first appellate authority's order to be correct, legal, and without any flaw, leading to the rejection of the appeal.

This comprehensive analysis of the judgment highlights the issue of cenvat credit on service tax paid for Rent-a-Cab service, the legal precedent set by the High Court of Karnataka, and the Tribunal's decision based on the established legal principles.