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TMI Blog2011 (4) TMI 201X X X X Extracts X X X X X X X X Extracts X X X X ..... e tax leviable under section 66 of the Finance Act and paid on any input service received by the manufacturer of a final product - Decided in favour of the assessee - CEA NOS. 96 TO 99, 124 & 125 OF 2009 - - - Dated:- 8-4-2011 - N. KUMAR AND RAVI MALIMATH, JJ. T.M. Venkata Reddy for the Appellant. K.S. Ravishankar for the Respondent. JUDGMENT N. Kumar, J. All these appeals are preferred by the revenue challenging the order of the Tribunal which held that the assessees are entitled to Cenvat credit on the service tax paid on outdoor catering services, transportation charges, rent-a-cab scheme and Group Health Insurance. 2. The assessees are manufacturers of parts and accessories of motor vehicles falling under Chapter 87089900 of the Central Excise Tariff Act, 1985. They are also availing Cenvat credit of duty paid on inputs, capital goods and service tax paid on services used in or in relation to manufacture of their final products. 3. By the scrutiny of the records, the revenue found that the assessee had availed and utilized input service tax credit relating to canteen services. They also noticed that the assessee had availed and utilized t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s and the Cenvat credit in respect of the same credit is admissible. The Group Health Insurance Policy is taken to protect the interest of the employees either during the course of their journey to the factory or while working in the factory and the cost of that insurance premium is also a factor that the manufacturer takes into consideration in fixing the price of the goods manufactured. The service tax paid on the said service, the manufacturer is entitled to Cenvat credit and therefore the order passed by the original authority as well as the appellate authority were set aside and the benefit of Cenvat credit was restored. Aggrieved by the same, the revenue is in appeal. 6. Sri T.M. Venkata Reddy, the learned counsel appearing for the revenue assailing the impugned order contends that the definition of input service as contained in Rule 2(l) did not include Outdoor Catering, Rent-a-Cab Service or Group Health Insurance and therefore the Tribunal was in error in holding that those services fall within the definition of input service and in extending the benefit to the assessee. He also contended that those services are in the nature of welfare measure to the employees and it ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... indirectly, in or in relation to the manufacture of final products and (clearance of final products upto the place of removal)'' and includes services used in relation to setting up, modernization, renovation or repairs of a factory, premises of provider of output service or an office relating to such factory or premises, advertisement or sales promotion, market research, storage upto the place of removal, procurement of inputs, activities relating to business, such as accounting, auditing, financing, recruitment and quality control, coaching and training, computer networking, credit rating, share registry, and security, inward transportation of inputs or capital goods and outward transportation upto the place of removal; 10. As is clear from the definition any service used by the manufacturer whether directly or indirectly in or in relation to the manufacture of final products constitutes input service. Various services are set out in the definition expressly; as constituting input service. It also includes transportation of inputs or capital goods and outward transportation upto the place of removal. Therefore the test is whether the service utilized by the asses ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Canteen Service 12. It is in this context that when the assessee provides outdoor canteen facilities because of a statutory obligation imposed on him under section 46 of the Factories Act, it becomes a condition of service as far as the employees are concerned. He has paid the service tax on outdoor canteen services. The said expenses incurred by the assessee will also be taken into consideration before fixing the price of the final product. It may be a welfare measure but certainly it is not a charity provided by the employer to the employees. It is an onerous legal obligation imposed on him. The cost incurred in rendering such service will be included in the cost of production. Rent-A-CAB Service/Transportation 13. Rent-a-Cab service is provided by the assessee to these workers to reach the factory premises in-time which has a direct bearing on the manufacturing activity. In fact the employee is also entitled to conveyance allowance. It also would form part of a condition of service and the amounts spent on the conveyance of the employees is also a factor which will be taken into consideration by the employees in fixing the price of the final product. By no stretch of im ..... X X X X Extracts X X X X X X X X Extracts X X X X
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