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TMI Blog2019 (6) TMI 67X X X X Extracts X X X X X X X X Extracts X X X X ..... resent case relates to interpretation of the definition of input service therefore extended period cannot be invoked and penalties cannot be imposed - the penalties under Rule 15(2) of Cenvat Credit Rules, 2004 read with Section 11AC (i)(c) of Central Excise Act, 1944 set aside - extended period also not available. The matter is remanded back to the original authority to re-quantify the demand for the normal period which the appellant is liable to pay - appeal allowed by way of remand. - E/20174/2019-SM - Final Order No. 20450/2019 - Dated:- 31-5-2019 - SHRI S.S GARG, JUDICIAL MEMBER Mr. N. Anand, For the Appellant Mrs. Kavitha Podwal, Superintendent (AR) For the Respondent ORDER Per: S.S Garg The present appeal is directed against the impugned order dated 12.11.2018 passed by the Commissioner (Appeals) whereby the Commissioner (Appeals) has rejected the appeal of the appellant. Briefly the facts of the present case are that the appellants are engaged in the manufacture of CNC Machines, special purpose machines, Milling machines falling under Chapter 84 of Central Excise Tariff Act, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he Employees Provident Fund and Miscellaneous Provision Act, 1952 provides for the institution of compulsory Provident Fund, Pension Fund and Deposit-Linked Insurance Fund for the benefit of the employees in the Factories and other establishments. He further submitted that all the establishments and factories to which this Act applies have to compulsorily contribute towards Provident Fund, Pension Fund and Deposit-Linked Insurance Fund and it is obligatory on the part of every employer to contribute certain specified amount of percentage towards these funds. He further submitted that Group Insurance cost being a employee cost and forms part of wages/salaries just like PF, ESI is in the nature of cost of labour/cost of manufacture and would form part of the assessable value of the final goods manufactured by the appellant. He further submitted that Group Insurance Service received from SBI Life Insurance Company is not excluded by virtue of clause (C) of Rule 2(l) of Cenvat Credit Rules. The said exclusion in clause (C) of Rule 2(l) is applicable only when such services are used primarily for personal use or consumption of any employee whereas Group Insurance Services received by th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d in Clause (C) w.e.f. 01.04.2011 has held that Outdoor Catering Service is not eligible for input service credit post amendment dated 01.04.2011. 5. After considering the submissions of both the parties and perusal of the material on record, I find that the only issue involved in the present case is whether the appellant is entitled to avail cenvat credit of input services relating to Life Insurance Policies of Employees on the invoices of SBI Life Insurance Company for the period July 2013 to March 2017. In order to decide this issue, it is necessary to note the definition of input service before 01.04.2011 and after 01.04.2011. Post 1-4-2011 the definition of input service stood thus : Rule 2(l) Input Service means any service, (i) used by a provider of output service for providing an output service; or (ii) used by the manufacturer, whether directly or indirectly, in or in relation to the manufacture of final products and clearance of final products, up to the place of removal, and includes services used in relation to modernization, renovation or repairs of a factory, premises of provider ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... products from 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 up to 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 up to the place of removal. 5.1. Further I find that the period involved in the present case is after the amendment in the definition of input service . The only ground which the learned counsel for the appellant has taken to justify the availment of cenvat credit on Group Life Insurance Service is that the appellant is statutorily required to take the said policy under the Employees Provident Fund and Miscellaneous Provisions Act 1952 which provide compulsory Provident Fund, Pension Fund and Deposit-Linked Insurance Fund for the benefit of the employees. He fu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... vat credit. We also find that the food is always mainly for personal consumption only. The canteen provided in the company is mainly for the personal consumption of the employee and it cannot be interpreted in any other way. Therefore, once such services are excluded, whether the employer or employee bears the cost partially or fully, has no bearing on the amendment. Therefore, keeping in view [the] above discussions and the various decisions cited by both the parties, we are of the considered view that the outdoor catering service is not eligible for input service credit post amendment dated 1-4-2011 vide Notification No. 3/2011, dated 1-3-2011. 5.2. Further I find that the decisions relied upon by the appellant are not applicable in the facts and circumstances of this case and they are distinguishable on facts. In view of my discussion above, I am of the considered view that the Larger Bench of the Tribunal in the case of Wipro Ltd. has considered the exclusion clause and has held that cenvat credit on input services as provided in the exclusion clause (C) is not available to the assessee post amendment. Further I find that the issue involved in the present ..... X X X X Extracts X X X X X X X X Extracts X X X X
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