M\/s. Rane Brake Lining Ltd. Versus Commissioner of GST & Central Excise
Central Excise
2018 (7) TMI 611 – CESTAT CHENNAI – TMI
CESTAT CHENNAI – AT
Dated:- 9-7-2018
Appeal No. E\/40355\/2018 – Final Order No. 41955 \/ 2018
Central Excise
Hon'ble Ms. Sulekha Beevi C.S., Member (Judicial)
\nMs. S. Yogalakshmi, Advocate for the Appellant
\nShri R. Subramaniam, AC (AR) for the Respondent
\n
\nORDER
\nBrief facts are that the appellants are manufacturers of Railway Brake Blocks, Disc Pads and Clutch Facings. They were availing the facility of CENVAT credit on inputs, capital goods and input services. Show cause notice was issued proposing to disallow the credit on various input services and after due process of law, the original authority allowed the credit on various services. The credit in respect of service tax paid on Director Sitting Fees as well as on premium for product liability insurance was disallowed. In appeal, Commissioner (Appeals) upheld the same. Hence this<\/p>\n
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Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n id for director sitting, she submitted that they have discharged the liability under reverse charge mechanism and it is incumbent upon the Director to attend the meetings and therefore the same is directly connected to the manufacturing activity of the appellant. To support her argument, she relied upon the decision in the case of SKN Organics P. Ltd. & Anr. Vs. Commissioner of Central Excise, Puducherry vide Final Order Nos. 41948 & 41949\/2016 dated 21.10.2016. = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n facturer. Further, in the case of Granules India Ltd. (supra), the Tribunal has held that the credit availed on directors' liability insurance is eligible. I find that the disallowance of credit on this input service is unjustified and requires to be set aside, which I hereby do. = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n","protected":false},"excerpt":{"rendered":" M\/s. Rane Brake Lining Ltd. Versus Commissioner of GST & Central ExciseCentral Excise2018 (7) TMI 611 – CESTAT CHENNAI – TMICESTAT CHENNAI – ATDated:- 9-7-2018Appeal No. E\/40355\/2018 – Final Order No. 41955 \/ 2018Central ExciseHon'ble Ms. Sulekha Beevi C.S., Member (Judicial) Ms. S. Yogalakshmi, Advocate for the Appellant Shri R. Subramaniam, AC (AR) for the … Continue reading “M\/s. Rane Brake Lining Ltd. Versus Commissioner of GST & Central Excise”<\/span><\/a><\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[],"tags":[],"class_list":["post-12559","post","type-post","status-publish","format-standard","hentry"],"_links":{"self":[{"href":"https:\/\/goodsandservicetax.in\/GST\/index.php?rest_route=\/wp\/v2\/posts\/12559","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/goodsandservicetax.in\/GST\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/goodsandservicetax.in\/GST\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/goodsandservicetax.in\/GST\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/goodsandservicetax.in\/GST\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=12559"}],"version-history":[{"count":0,"href":"https:\/\/goodsandservicetax.in\/GST\/index.php?rest_route=\/wp\/v2\/posts\/12559\/revisions"}],"wp:attachment":[{"href":"https:\/\/goodsandservicetax.in\/GST\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=12559"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/goodsandservicetax.in\/GST\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=12559"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/goodsandservicetax.in\/GST\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=12559"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}
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\n3. The ld. AR Shri R. Subramaniam supported the findings in the impugned order. He adverted to para 7 of the impugned order and submitted that once the goods are sold and the products are handed over to the buyers, any service availed by them would be a post-manufacturing activity and therefore the insurance policy taken for product liability cannot be held to be an input service. With regard to the director sitting fee, he submitted that this has no nexus to the manufacturing activity.
\n4. Heard both sides.
\n5. The first issu<\/p>\n
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\n6. The second issue for consideration is regarding the eligibility of credit on service tax paid on Director Sitting Fees. The said issue is covered by the decision in the case of SKN Organics P. Ltd. (supra). Further, it is also to be stated that it is the duty of the director to attend the meetings and therefore the service tax paid on such fees is eligible for credit.
\n7. From the discussions made above, I am of the view that the disallowance of credit on the impugned services is incorrect and requires to be set aside, which I hereby do. The impugned order is set aside and the appeal is allowed with consequential relief, if any.
\n( Dictated and pronounced in open court )
Case laws, Decisions, Judgement<\/p>\n
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