Custom, Excise & Service Tax Tribunal
Jsw Steel (Salav) Ltd vs Commissioner Of Central Excise on 11 January, 2017
IN THE CUSTOMS, EXCISE & SERVICE TAX APPELLATE TRIBUNAL, WEST ZONAL BENCH AT MUMBAI COURT No. I Appeal No. ST/530, 531/12 (Arising out of Order-in-Appeal No. US/311 & 312/RGD/2012 dated 01.05.2012 passed by Commissioner of Central Excise & (Appeals), Mumbai) For approval and signature: Honble Mr. M.V. Ravindran, Member (Judicial) Honble Mr. C.J. Mathew, Member (Technical) ================================================
1. Whether Press Reporters may be allowed to see : No the Order for publication as per Rule 27 of the CESTAT (Procedure) Rules, 1982?
2. Whether it should be released under Rule 27 of the : No CESTAT (Procedure) Rules, 1982 for publication in any authoritative report or not?
3. Whether Their Lordships wish to see the fair copy : Seen of the Order?
4. Whether Order is to be circulated to the Departmental : Yes authorities?
JSW Steel (Salav) Ltd.
Appellant Vs. Commissioner of Central Excise Raigad Respondent Appearance:
Ms. Aparna H., Advocate for appellant Shri A.B. Kulgod, Asst. Commr (AR) for respondent CORAM:
Honble Mr. M.V. Ravindran, Member (Judicial) Honble Mr. C.J. Mathew, Member (Technical) Date of Hearing: 11.01.2017 Date of Decision: 11.01.2017 ORDER NO Per: M.V. Ravindran These two appeals are directed against Order-in-Appeal No. US/311 & 312/RGD/2012 dated 01.05.2012.
2. Heard both sides and perused the records.
3. The issue that falls for consideration is during the period April 2010 to March 2011, appellant had availed credit of service tax on various types of insurance policies taken by them. The insurance policies which were taken by the appellant during the relevant period are as under:-
(a) Marine Hull Policy For protection of vessels against damage;
(b) Public Utility Insurance Policy for insurance of more than one unit situated in different locations under a single policy;
(c) Standard Fire and Special Perils Policy Package Insurance for which broadly covers various set of perils like fire, lightning, explosion, aircraft damage, riot, strike, flood, storm, missile testing operation etc.;
(d) Burglary Standard Insurance Policy Policy providing cover for property contained in business premises, stocks owned by business etc.;
(e) Marine Cargo Open Policy Policy covering goods, freight and other interest against loss or damage to goods whilst being transported sea;
(f) Industrial All Risk Insurance Policy for Plant and machinery and other assets of the company. Policy to cover large manufacturing industrial risks;
(g) Marine War Insurance Policy Insuring War Perils
(h) Money Insurance Policy to cover for loss of money in transit between the insureds premises and bank or post office
(i) Contractors Plant and Machinery Insurance Policy All risks policy covering movable plant and machinery owned or leased by the principles or contractors who are hired during shut down.
4. It is the case of the appellant that the insurance policies as indicated herein above are for the purpose of receiving raw materials through water ways as they have their own fully operational jetty which is exclusively used for their business operations like bringing iron ore pellets and iron ore from various places. The lower authorities issued show-cause notices which denied the CENVAT credit of the service tax paid on the insurance policies on the ground that the activities are not integrally connected with the business of appellant. Adjudicating authority after following due process of law came to a conclusion that the appellants are not eligible for availing CENVAT credit. Coming to such conclusion adjudicating authority confirmed the demand raised along with interest and also imposed penalties.
5. Learned Counsel would submit that the issue is no more res integra inasmuch as the Hon'ble High Court of Karnataka in the case of Commissioner of Central Excise v. Stanzen Toyotetsu India (P) Ltd. 2011 (23) STR 444 (Kar.) has held that the service tax paid on insurance policy covering their employees is eligible for availment of CENVAT credit. She would also submit that on an identical issue for the subsequent period, Commissioner (Appeals) in Order dated 10.03.2016 held in favour of the appellant which according to her is not yet contested by Revenue.
6. Learned D.R. reiterated the findings of the adjudicating authority.
7. We have considered the submissions made by both sides.
7.1 On perusal of records it is undisputed that the CENVAT credit is sought to be denied of the service tax paid on various policies which also includes the insurance on the employees working in the appellants organization. It is seen that the policies which have been taken by appellant are in respect of various machineries, tugs, vessels etc and also for public utility insurance for more than one unit situated in different locations under a single policy.
7.2 In our considered view, all these insurance policies which have been taken by appellant are connected with the activity of the appellant i.e. manufacturing of Hot Iron and Sponge Iron on which appellant discharges Central Excise duty as applicable. We find that the ratio of the decisions of the following case laws on this point is directly applicable in the case in hand:-
(a) CCE v. Stanzen Toyotetsu India P.Ltd. 2011 (23) STR 444 (Kar)
(b) DSCL Sugar 2014 (34) STR 58 (T)
(c) Grasim Inds. 2013 (32) STR 256 (T)
(d) J.K. Cement 2013 (31) STR 687 (T)
(e) Shree Khedut 2013 (31) STR 555 (T)
(f) Deepak Fertilizers 2013 (32) STR 532 (Bom)
(g) Ultratech Cement Ltd. 2010 (20) STR 577 (Bom) 7.3 Accordingly, in the facts and circumstances of this case and the judicial pronouncements, we hold that the impugned order is unsustainable and liable to be set aside.
7. The impugned order is set aside and the appeals are allowed with consequential relief, if any. (operative part pronounced in Court) (C.J. Mathew) Member (Technical) (M.V. Ravindran) Member (Judicial) nsk 1 5 Appeal No. ST/530, 531/12