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2018 (5) TMI 1213 - AT - Service TaxCENVAT credit - input services - Guest House Maintenance - Colony upkeeping expenses - period from July 2010 to December 2010 - Held that - the issue is squarely covered in favor of the appellant by the decision given by the Tribunal in the appellant s own case Ultra Tech Cement Ltd. Versus Commissioner of Central Excise Nagpur 2015 (3) TMI 1123 - CESTAT MUMBAI wherein the Tribunal has held that the assessee is entitled to cenvat credit in respect of the services used or utilized in the Residential Colony and the Guest House which are situated at a place away from the factory - credit cannot be denied - appeal allowed - decided in favor of appellant.
Issues:
Appeal against disallowance of cenvat credit on service tax paid on Guest House Maintenance and Colony upkeeping expenses. Analysis: The appeal challenged the Order-in-Original disallowing cenvat credit on service tax paid on Guest House Maintenance and Colony upkeeping expenses for the period from July 2010 to December 2010. The Commissioner (Appeals) upheld the disallowance, stating that the services did not fall under the definition of 'input service' as they lacked nexus with the appellant's business. The appellant argued that the Guest House and Colony services were essential for the manufacturing process, citing precedents like CCE, Hyderabad Vs. M/S. ITC and Reliance Industries Ltd. Vs. CCE & ST (LTU), Mumbai. The appellant contended that the costs incurred in these services were part of the production cost, relying on decisions such as M/s. Coca Cola India Pvt. Ltd. Vs. CCE, Pune and CCE, Nagpur Vs. Ultratech Cement Ltd. The appellant further cited their own case decisions where cenvat credit on Residential Colony and Guest House was allowed. The Tribunal had previously ruled in favor of the appellant, following the decision of the Andhra Pradesh High Court in the case of CC Vs. ITC. The appellant distinguished the decision of CCE, Nagpur Vs. Manikgarh Cement, arguing that it was not applicable in their case. The appellant emphasized that the Guest House and Colony services were necessary for employee availability and operational efficiency, especially in a remote location. The appellant relied on legal precedents to support their claim for cenvat credit on these services. On the contrary, the Respondent defended the impugned order, arguing that the Guest House and Colony maintenance services had no nexus with the final product manufactured by the appellant. The Respondent cited various decisions to support their stance, including DCW Ltd. Vs. CCE, Tirunelveli and Polylink Polymers (P) Ltd. Vs. CCE, Ahmedabad-II. However, after considering the arguments of both parties and reviewing the case law presented, the Tribunal found that the issue was conclusively in favor of the appellant. The Tribunal referenced its own previous decisions in the appellant's case, where cenvat credit for similar services was allowed. By following the precedent set by the Andhra Pradesh High Court in the case of ITC, the Tribunal concluded that the appellant was entitled to cenvat credit for the services related to the Residential Colony and Guest House. Consequently, the impugned order disallowing the cenvat credit was deemed unsustainable in law, and the appeal of the appellant was allowed with any necessary consequential relief.
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