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TMI Blog2012 (4) TMI 134X X X X Extracts X X X X X X X X Extracts X X X X ..... ng service, and (v) CHA Service. The periods of dispute are (i) February 2006 to January 2008 (No.E/1116/2010), (ii) January to May 2008 (No.E/1117/2010) and (iii) August to December 2008 (E/945/2011). The lower authorities denied CENVAT Credit on the aforesaid services holding that the services were not proved to be input services coming within the ambit of the definition of input service given under Rule 2(l) of the CENVAT Credit Rules (CCR), 2004. Various reasons were stated by the authorities for holding that the services availed by the appellant did not qualify to be input services for the purpose of CENVAT credit. The appellant was found to have contravened the provisions of the CCR, 2004 through irregular availment of CENVAT credit o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ts recognition as an input service defined under Rule 2(l) of CCR, 2004. In this context, it is fairly pointed out that the appellant recovered a part of the cost of food from their employees (ultimate consumers). The learned counsel quickly adds that the company will not claim CENVAT credit on outdoor catering service to the extent of recovery from their employees. The learned Commissioner (AR), on the contrary, submits that the appellant who admittedly did not employ 250 or more people during the material period cannot claim the benefit of CENVAT credit on outdoor catering service . It is further submitted that, even otherwise, the benefit cannot be claimed by them to the extent the food supplied to the employees was subsidized. According ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Toyotetsu. In the case of GTC Industries (supra) the Tribunal s Larger Bench had considered the number of employees as one of the factors in the context of examining whether the assessee could claim CENVAT credit on outdoor catering service . Section 46 of the Factories Act was taken note of and it was held that it was mandatory, under that provision, for a manufacturer employing more than 250 workers to maintain a canteen in the factory. Accordingly, it was held to the effect that there was nexus between outdoor catering service and the manufacture of goods by the manufacturer who availed the said service for supply of food to workers numbering 250 or more. In other words, the legal obligation of the manufacturer under the Factories Act wa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the submission of the learned counsel that, given an opportunity, evidence of such connection can be established by the appellant. Similar submissions have been made from both sides in respect of cleaning/house keeping service also. I am of the view that, for the ends of justice, a reasonable opportunity should be given to the appellant to establish, before the original authority, the requisite nexus between the business of manufacture of goods and the services which are claimed to be input services for the purpose of CENVAT credit. 5. As regards CHA service , the learned counsel submits that this service was availed for export of goods. He points out that this fact is not in dispute and that the benefit was denied on the sole grou ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... appellant. In the result, these appeals are partly allowed, partly rejected and partly allowed by remand. CENVAT credit on CHA is held admissible to the appellant and that on outdoor catering service is held inadmissible. The question whether CENVAT credit can be claimed on other services shall be revisited by the original authority after giving the party a reasonable opportunity of being heard and adducing evidence. Needless to say that the quantum of inadmissible CENVAT credit should be determined and demanded with interest. 6. On the penalty-related issue also, I have heard both sides. The submission of the learned counsel is that no penalty can be imposed under Rule 15 of the CCR, 2004 on any person who is found to have wrongly ..... X X X X Extracts X X X X X X X X Extracts X X X X
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