KKR India Advisors Pvt. Ltd. Versus CCGST, Mumbai East
Service Tax
2018 (12) TMI 1483 – CESTAT MUMBAI – TMI
CESTAT MUMBAI – AT
Dated:- 12-12-2018
Appeal No. ST/86321/18 – A/88097/2018
Service Tax
Dr. Suvendu Kumar Pati, Member (Judicial)
Shri Tirumalai, Advocate for the appellant
Shri MP. Damle, AC (AR) for the respondent
ORDER
Rejection of refund claims made against cenvat credit availed on input services by appellant company engaged solely in export of investment advisory services on the ground of inadmissible credit concerning rent a cab service, membership of club or association service, real estate agency service (visa), management, maintenance repair services by the Commissioner (Appeals) is challenged in this appeal.
2. Factual backdrop of the case is that appellant is investment banking forum having tie up with KKR group had entered into consulting service agreement with a Mauritius unit and it had been providing advisory service in connection with
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d the order concerning inadmissible part in this forum.
3. In the memo of appeal and during the course of hearing of appeal, in filing additional submissions and judicial decisions of the Tribunal including the one passed by CESTAT, Mumbai vide order no. A/86146-86147/18 dated 24.04.2018 in respect of appellant's own case concerning the period post 01.04.2011 in which appellant's claim in relation to Real estate agency service, club or association services are held to have relationship with the output service provided by the appellant. Ld. Counsel for the appellant argued that in respect of repair & maintenance services, cleaning services, club and association services in Rituja India case tribunal at Hyderabad vide A/30315/2016 dated 13.05.16 also had held that those services are activities relating to business and allowed the credit where the appellant EOU was engaged in IP software services. Further, with reference to case laws reported in Xilinx India Technology Services P
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ose services were used in direct relation to the output services and hence admissible credits for which he prayed for setting aside the order of the Commissioner (Appeals).
4. In response to such submission, ld. AR for the respondent department fully supported the reasoning and legality of the order passed by the Commissioner (Appeals) and in respect of club membership services the expenses were held to be in the nature of recurring benefit extended to the employees and the appellant failed to prove that the said services were not used for the personal use of the employees. Referring to the order passed by the Commissioner (Appeals) that rent a cab vide circular 120/01 by 19.01.2010 qualify as input if rent a cab was pick up of employees, the same is also eligible for credit if the office runs for 24X7 basis. No such proof was established that appellant company was open round the clock. He noted that real estate agency Service were rightly held by the Commissioner to be inadmissible a
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nsight to wide range of common business clearance and sharing ideas. Likewise, its membership in Indian hotel co. Ltd. is for the purpose of having seminars for enhancement of credibility of organisation and sale promotion of business that would augment the brand value of the appellant. In respect of rent a cab Service also, it has indicated its uses towards providing transportation facilities for pick up drop to airport to employees attaining seminars workshops training for its director and its guests. The appellant also submitted by way of filing a synopsis that those membership and cab operating facilities were availed by it in the name of the company and not in the name of any of the employees that would attract personal benefit/ consumption. In admitting that Visa services were put under wrong nomenclature as real estate service, it also has stated that the same ought to have been in the nature of management consultancy visa fees paid for professional services provided by Expardri
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ing the factual position, the order of the Commissioner (Appeals) would have been sustained if there not been a clarificatory circular issued on 19.01.2010 vide 120/01/2010-S.T. by the Department of Revenue. The circular clearly indicates that conjoint reading of the Cenvat Credit Rules is to be made with Notification no. 5/2006-CX(NT) to broaden the meaning of input service so as to cover its relationship to output service. The said circular also has attempted a liberal approach in stating that example of services like outdoor catering, rent a cab for pick up and drop of employees to office etc. are input services, without reference to if such pick up is from office or from airport. It also had indicated that correlation and scrutiny of documents to establish nexus is not required to be made if Chartered Accountant certificate or a self certification of the exporter is available to that effect and the department officers are only required to make basic scrutiny of the documents, which
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