2018 (2) TMI 143 - AT - Service Tax

CENVAT credit - input services - rent-a-cab service - tour operator service - renting of immovable property - general insurance service (medi claim) - event management service - denial on the ground of nexus - Held that - the definition of input services prior to 1.4.2011 included the words activities relating to business and therefore had a wide ambit covering almost all services - There are plethora of decisions which covers both the services which are impugned in the present appeal - credit allowed - appeal allowed - decided in favor of appellant.

Summary

Issues: Denial of input service credit on event management services and mediclaim services for the period from April 2010 to March 2011.

Analysis:
The appellant, a global engineering and construction contractor, availed CENVAT credit of service tax paid for project management, procurement, and engineering design services provided to Indian Oil Corporation Ltd. The Department issued a show cause notice proposing to demand wrongly availed input service credit for services like rent-a-cab, tour operator, immovable property renting, general insurance (medi claim), and event management. The original authority denied credit on event management and mediclaim services, stating they lacked nexus with output services. The Commissioner (Appeals) set aside the demand for some services but upheld the denial for event management and mediclaim services. The appellant appealed against this denial.

The appellant's counsel argued that the disputed period predated the change in the definition of input services on April 1, 2011, which previously included "activities relating to business." Citing relevant case law, including the Hon'ble Bombay High Court's decision in Commissioner Vs. Ultratech Cement Ltd., the Tribunal's decision in PTC Software India Pvt. Ltd. Vs. Commissioner of Central Excise, Pune, and other judgments, the counsel contended that credits for insurance and event management services should be allowed.

The Assistant Commissioner reiterated the findings in the impugned order during the hearing. Upon hearing both sides, the tribunal noted that the pre-2011 definition of input services had a broad scope, covering almost all services. Referring to the cited judgments, including those from the Hon'ble Karnataka High Court and previous tribunal decisions, the tribunal held that the appellants were eligible for credit on event management and mediclaim services. Consequently, the impugned order was set aside, and the appeal was allowed with any consequential relief.

In conclusion, the tribunal's decision allowed the appellant to avail credit for event management and mediclaim services, emphasizing the broad scope of the pre-2011 definition of input services and citing relevant case law to support its ruling.