2016 (8) TMI 976 - AT - Central Excise

Cenvat credit - Member subscription Service - paid subscription to Automotive Components Manufacturers Association (ACMA) for getting business support in respect of participation in exhibitions, technology development and automobile market status etc. - Held that - the case law relied upon by the appellant in the case of BAL Pharma Ltd. Vs. CCE & ST, Bangalore-I 2014 (10) TMI 564 - CESTAT BANGALORE is squarely applicable to the facts of the present case. Having regard to the nature of service received, amount involved and the definition of input services, the appellant is eligible for the credit of duty paid by them on Member subscription Service . - Decided in favour of appellant with consequential relief

Summary

Issues:
1. Denial of Cenvat credit on "Member subscription Service" by the Revenue.
2. Appeal against the decision of the Commissioner (Appeals) disallowing the credit.

Analysis:

Issue 1: Denial of Cenvat credit on "Member subscription Service" by the Revenue
The appellant, engaged in manufacturing automobile parts, availed Cenvat credit on various inputs and input services. A show cause notice was issued proposing to deny Cenvat credit of ?10,300 on "Member subscription Service." The appellant argued that the subscription paid to Automotive Components Manufacturers Association (ACMA) was for business support related to exhibitions, technology development, and sales promotion. The Superintendent dropped the proceedings initiated under the notice, but the Commissioner (Appeals) allowed the Revenue's appeal, disallowing the credit along with interest. The issue revolved around the eligibility of Cenvat credit on this service.

Issue 2: Appeal against the decision of the Commissioner (Appeals) disallowing the credit
The appellant contended that the "Member subscription Service" was an input service used in relation to manufacturing final products, making them eligible for the credit. The appellant relied on a decision by the Bangalore Bench of the Tribunal in a similar case. On the other hand, the Revenue supported the Commissioner (Appeals)' decision to recover the service tax credit of ?10,300 along with interest. The Tribunal, after hearing both sides and examining the records, found that the appellant was indeed eligible for the credit based on the nature of the service received, the amount involved, and the definition of input services.

In conclusion, the Tribunal set aside the impugned order and restored the Original Order-in-Original (OIO), allowing the appeal with any consequential relief. The judgment emphasized the eligibility of the appellant for the Cenvat credit on the "Member subscription Service" based on the applicable case law and the nature of the service provided.