Custom, Excise & Service Tax Tribunal
Yes vs Represented By : Shri Rahul Gajera, ... on 22 August, 2014
CUSTOMS EXCISE & SERVICE TAX APPELLATE TRIBUNAL, West Zonal Bench, Ahmedabad Appeal No. : ST/10618/2013 Arising out of : OIA No. SRP-197-VAPI-2012-13 dt. 09.01.2013 Passed by : Commr. (Appeals) C. Excise & Customs, Vapi For approval and signature : Mr. M.V. Ravindran, Honble Member (Judicial) 1 Whether Press Reporter may be allowed to see the Order for publication as per Rule 27 of the CESTAT (Procedure) Rules, 1982? No 2 Whether it should be released under Rule 27 of CESTAT (Procedure) Rules, 1982 for publication in any authoritative report or not? No 3 Whether their Lordships wish to see the fair copy of the Order? Seen 4 Whether Order is to be circulated to the Departmental authorities? Yes Appellant (s) : M/s. Best Paper Mills Pvt. Limited Represented by : Shri Rahul Gajera, Advocate Respondent (s) : Commissioner of Central Excise & S.T., Vapi
Represented by : Shri J. Nair, A.R. CORAM :
Mr. M.V. Ravindran, Honble Member (Judicial) Date of Hearing / Decision : 22.08.2014 ORDER No. A/11533 / 2014 Dated 22.08.2014 Per : Mr. M.V. Ravindran;
This appeal is directed against the OIA No. SRP-197-VAPI-2012-13 dated 09.01.2013.
2. Heard both sides and perused the records.
3. The issue involved in this case is regarding denial of cenvat credit of Rs. 2,60,599/- availed on the service tax paid by the insurance providers on various insurance policies taken out by the appellant.
4. Undisputed facts are that appellant is manufacturers and have taken insurance of cash in transit and in the factory, fire and special peril, electronic equipments, terrorism risk, building, machinery, boiler and pressure plants etc. Appellants availment of cenvat credit was contested by the lower authorities and held against him on the ground that the address mentioned in the insurance policy includes another address and the said service tax credit has no nexus with the manufacturing activity.
5. Learned counsel was correct in bringing to my notice that the issue of availment of cenvat credit on the service tax paid by the insurance company is eligible has been decided by the Tribunal in the following cases:-
(a) Oudh Sugar Mills Limited - 2012 (282) ELT 541 (Tri. Del.)
(b) DSCL Sugar - 2012 (28) STR 559 (Tri. Del.)
(c) Monnet Ispat & Energy Limited - 2010 (19) STR 417(Tri. Del.)
6. On perusal of the said case laws, I do find that the coordinate bench of the Tribunal has specifically stated that insurance of plant and machinery, companys vehicles, cash in box and in transit at various counters etc. and the services provided in relation to the business activity of an assessee. On merits, I find that appellant has made out a case that they are eligible for availment of such cenvat credit of the service tax paid on the insurance policies taken out for plant and machinery, cash in transit, cash in hand etc.
7. As regards the denial of cenvat credit on the ground that insurance policy has another address. it is undisputed that the second address mentioned in the insurance policy is also of the same assessee. It was claimed by the appellant assessee before the lower authorities that the second address indicated in the insurance policy is nothing but an open plot purchased and allotted to them by GIDC vide allotment letter dated 12.10.2010. On perusal of the records, I find that the premium paid on the insurance policies were prior to the allotment and in the said allotment letter it is specifically indicated that the appellants were handed over an open and vacant plot by the GIDC for further constructions. Be that as it may, since the open and vacant plot is also of the same assessee, even if the insurance policy covers the said plot, denial of cenvat credit of service tax paid seems to be not in consonance with the law.
8. At this juncture, learned departmental representative brings to the notice of the bench that appellant had claimed refund of the premium paid from the insurance authority and no specific amount is indicated. Learned counsel produces before me a statement which has been collated from the records available in the appeal papers that there is a refund of an amount of Rs. 28,681/- of Service Tax claimed by the appellant from the insurance companies. It is his submission that service tax credit taken on such amount is incorrect and they are ready to reverse the said amount. Fair offer made by the learned counsel is accepted and the assessee is directed to reverse an amount of Rs. 28,681/- claimed as refund by them from the insurance company, within 30 days on receipt of certified copy of this order. Needless to state that the appellant has also to pay interest on the said amount of Rs. 28,681/-.
9. As regards the balance amount of Rs. 2,31,918/-, as recorded herein before by me, appellant is eligible to avail cenvat credit and the impugned order to that extent is incorrect and is liable to be set-aside and I do so. Since I allowed the appeal of the appellant upholding reversal of small amount, there is no necessity of visiting the appellant of any penalty.
Appeal is allowed as indicated hereinabove.
(Dictated and pronounced in the Court) (M.V. Ravindran) Member (Judicial) KL...
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