M/s. Kohinoor Printers Pvt. Ltd. Versus GST & CCE, Chennai Outer
Central Excise
2018 (5) TMI 1357 – CESTAT CHENNAI – TMI
CESTAT CHENNAI – AT
Dated:- 15-5-2018
E/42575-42576/2017 – Final Order No. 41485-41486/2018
Central Excise
Hon'ble P. Dinesha, Member (Judicial)
Shri G. Vijayabalan, Adv. for the appellant
Shri R. Subramaniyam, AC (AR) for the Respondent
ORDER
Brief facts of the case are that the appellants are manufacturers of 'Printed Cartons' and are availing Cenvat credit of the duty paid on inputs, capital goods and service tax paid on input services. It is the case of the Revenue that during verification of assessee's accounts it was noticed that they had availed Cenvat credit of service tax paid on various services for the period from June 2011 to May 2012. The department was of the view that these services were neither used directly nor indirectly nor in relation to the manufacture and therefore the said services do not qualify as input services for a
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from the definition of input service. Both the authorities below erred in holding that Rent-a-cab service does not merit coverage under the definition of Rule 2 (l) of the CCR, 2004 prior to or after 01.04.2011, which is contrary to the Board's clarification in Circular No. 943/04/2011-Cx dated 29.04.2011, specifically given to the service in question. He submitted that the period involved in this case being prior to 01.04.2011, it is settled in various decisions laid down by the Hon'ble High Courts and Tribunal that these services are eligible for credit and prayed that the impugned order may be set aside. Ld. Counsel relied on the following case laws in support of his submissions:-
1. CCE, Vadodara Vs. Hadyn Glass Gujarat Ltd. 2009 (240) ELT 729 (Tri.)
2. Jaypee Rewa Plant Vs. CCE, Bhopal 2010 (17) STR 519 (Tri.-Del)
3. J.K. Sugar Ltd. Vs. CCE, Meerut 2011 (270) ELT 225 (Tri.-Del)
4. CCE Vs. HEG Ltd. 2010 (20)STR 312
5. CCE, Visakhapatnam Vs. AP Paper Mills Ltd. 2011 (22) S
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rguments.
5.1 The main ground raised is that whether the appellants are eligible for Cenvat credit on 'Rent-a-Cab service. It is the case of the appellant that they all along pleaded right from their reply to the SCN, that Rent-a-cab service has been used by them for official purposes only and that too it was prior to 01.04.2011. For the subsequent period ie., from 01.04.2011 to 31.12.2011 they have reversed the credit that was availed vide RG 23 A Part 2 Sl. No. 04 dated 10.01.2012 and also paid interest. It was further pleaded that the staff and executives used the rent-a-cab service for procuring raw materials, canvassing business for sale of finished goods or for consumables, spares etc., which fact was not disputed by the Revenue. In this context, it is very useful to refer to an order of this very Court in the case of Sundaram Clayton Ltd. (supra), wherein it has been held as under:-
“5 (i) Rent a cab service is found to be essential for the transportation of the employees in
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asic necessity. To ensure that the work force comes on time at the work place, the employers have taken this measure which has a direct bearing on the manufacturing activity. At any rate it is an activity relating to business.
5.3 The above view has been reiterated or followed in most of the judgments/orders referred during hearing. The Revenue has denied the benefit without indicating as to how Rent-a-cab service has no nexus, directly or indirectly, with the manufacturing activity of the appellant. No doubt, the Hon'ble Supreme court in the case of M/s. Maruti Suzuki Ltd. Vs. CCE, Delhi reported in 2009 (240) ELT 641 (S.C) has held that crucial requirement for availment of input credit of all goods is 'used in or in relation to the manufacture of final products'. In the case on hand, admittedly, the Revenue has not negatived the plea of the appellant that the service availed of Rent-a-cab service had been used for official purposes by the employees of the appellant, for or during th
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