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TMI Blog2020 (2) TMI 107X X X X Extracts X X X X X X X X Extracts X X X X ..... Service" used for pick-up and drop of employees of the Appellant to and fro Andheri and Kurla to their office premises is admissible as 'input service' under Rule 2(l) of Cenvat Credit Rules, 2004. 3. The facts of the case in brief are as follows. The Appellants are engaged in providing Management Consultants Service, Manpower Recruitment and Supply Agency, Storage and Warehousing Service, Dry Cleaning Service and also Outdoor Catering Service. The main service provided by the Appellant is Catering Service. During the course of Audit it was observed that the Appellant had wrongly availed Cenvat credit of service tax paid on transportation of employees to and fro Andheri and Kurla to their premises which, according to the department, does ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er 01/04/2011, since the exclusion from definition of input service w.e.f. 01/04/2011, is only if the vehicles used for providing the said service are not capital goods. According to him, the services used for transportation of employees are for ensuring that the employee reaches to work place on time. He also raise the issue of limitation. According to him, the demand for the period from April, 2006 to March, 2011 is barred by limitation as known of the exigencies and envisaged under proviso to Section 73 is present case as there was suppression of facts, misdeclaration etc. and hence provision of Section 78 is not invocable. He also submits that the disputed input service was used for providing both taxable and exempt services and they ha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ar as Rent-a-Cab/Tour Operator service is concerned, it is the case of the appellant that the said service is utilized by the appellant for pick up and drop of employees to and from the work place so that they reaches to and fro to the work place on time and carries out the work efficiently of providing the output services. The said service cannot be said to be used primarily for the personal use of the employees. Alongwith the Memo of Appeal, the Appellants have filed invoices also to establish the nexus between the aforesaid input service with the output service. Rent-a-cab/Tour Operator service has been excluded from the definition of input service w.e.f. 1.4.2011 and prior to that it came within the definition of input service. Undoubte ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the Audit Parties from time to time but no objections were ever raised. The condition precedent for invoking extended period is that there has to be some fraud or collusion or suppression on the part of the assessee. The Hon'ble High Court of Judicature at Bombay in the matter of Saswad Mali Sugar Factory Ltd. v. C.C.E., Pune II - 2013-TIOL-898-HC-MUM-ST = 2014 (33) S.T.R. 481 (Bom.) has clearly held that the conditions for invocation of the extended period of limitation under Section 73 of the Act and the conditions precedent for imposing penalty under Section 78 of the Act are identical, namely existence of elements of fraud, collusion and wilful misstatement or suppression of facts or contravention of the provisions of the Act with inte ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... or rent-a-cab operator service and since, they are not providing these services and are merely service recipient therefore, the credit on the Tour Operator Service/Rent-a- Cab service is not available to them and they are not eligible to take credit of these services. 7. The issue about the interpretation of amended Rule 2(l) qua rent-a-cab service came up for consideration before the Principal Bench of the Tribunal in the matter of M/s Marvel Vinyls Ltd vs Commissioner of Central Excise, Indore; 2016-TIOL-3071-CESTATA-DEL, where the Tribunal held that the Appellant therein are entitled to the service tax paid on the said service. The relevant paragraphs of the said decision are extracted as under: "xxx xxx xxx 3. After hearing bot ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ible. 6. However, I find flaw in the above interpretation of appellate authority. He has for the appellant. A person who is receiving the input services of renting of immovable property, can never avail cenvat credit of duty paid on the motor vehicles and as such motor vehicle can never be a capital good to the recipient of the said services. The motor vehicle will always be a capital good or otherwise for the person who is providing the services. For service provider falling under the category of renting of motor vehicle the motor vehicle would always be a capital good. As such the expression- " which is not a capital good appearing in the said exclusion clause would require examination vis-à-vis the service provider and not vis- ..... X X X X Extracts X X X X X X X X Extracts X X X X
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