Custom, Excise & Service Tax Tribunal
M/S.Sarita Handa Exports (P) Ltd vs Cce, Gurgaon-Ii on 12 May, 2016
CUSTOMS, EXCISE & SERVICE TAX APPELLATE TRIBUNAL,
SCO 147-148, SECTOR 17-C, CHANDIGARH-160017
SINGLE MEMBER BENCH
Court-I
Appeal No. E/52388/2015
[Arising out of the Order-in-Appeal No.CE/APPL-II/DELHI_-2015 dt.27.2.15 passed by the CCE, Gurgaon-II)
Date of Hearing/Decision: 12.05.2016
For Approval & signature:
Honble Mr.Ashok Jindal, 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 would be released under Rule 27 of the 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 Department Authorities?
Yes
M/s.Sarita Handa Exports (P) Ltd. Appellant
Vs.
CCE, Gurgaon-II Respondent
Present for the Appellant: Shri Ram Chander Choudhary, Adv.
Present for the Respondent: Shri Satyapal, AR
Coram: Honble Mr.Ashok Jindal, Member (Judicial)
FINAL ORDER NO. 60064/2016
PER: ASHOK JINDAL
The appellant is in against the impugned order denying the cdredit on various input services for the period September, 2011 to July, 2012 on the premise that the same do not qualify as input service as per Rule 2(l) of Cenvat Credit Rules, 2004.
2. The services in dispute are as under:-
(i) AMC of air conditioners
(ii) AMC for lifts
(iii) Business tour and hotel boarding and lodging service
(iv) Tour and travel service
(v) Customs clearance service
(vi) Construction service
(vii) Insurance service
(viii) Office maintenance service
(ix) Photocopy service
(x) Photography service for samples of export manufactured by the appellant
(xi) Professional and consultancy service
3. Heard the parties and considered the submissions.
4. On careful consideration of the submissions made by both sides, I find that the usage of services have to be examined an thereafter it is to be decided whether the appellant is entitled to credit or not. Therefore all services are dealt with separately.
(a) AMC of Air Conditioners:
5. The air conditioners are installed in the office as well as manufacturing area to maintain adequate temperature for manufacture of good. This service can be treated an activity of modernization of factory and office of the factory premises. Therefore, the same qualify as input service as per Rule 2(l) of Cenvat Credit Roles, 2004. Consequently, the credit on AMC of air conditioners is allowed.
(b) AMC of lifts:
6. These lifts are used for taking material from lower floors to upper floors and bringing from upper floors to lower floors of the factory premises having three floors. As the usage of lifts has been explained by the appellant that the lifts facilitate in movement of raw material an finished goods manufactured by the appellant. Therefore, the AMC of lifts has nexus with manufacture of excisable goods. Therefore, the appellant is entitled for credit on AMC of lifts as per Rule 2(l)
(c) Business tour and hotel boarding and lodging service:
7. These services have been used by the appellant for marketing and sale promotion of finished goods as well as procurement of raw material or capital goods. Therefore, these services are entitled for input service credit as the same is integral part of manufacturing activity. Therefore, the input service credit is allowed to the appellant.
(d) Tour and travel service:
8. The appellant has already reversed the credit on these services, therefore, the credit is allowed as the service has been excluded from the scope of the input service with effect from 1.4.2011.
(e) Customs clearance service:
8. This service has been used in relation to obtaining the export incentives. Therefore, the same has nexus with manufacture and clearance of export of goods. In that circumstance, the appellant is entitled for credit.
(f) Construction service:
9. This service has been used for repair and maintenance of factory premises is specified as an admissible input service under Rule 2(l) of Cenvat Credit Rules, 2004, therefore, the same is allowed.
(g) Insurance service:
10. This service has been used for insurance of factory premises, plant and machinery and stock of goods. The said service has direct nexus with manufacturing of excisable goods. Therefore, the credit cannot be denied. Consequently, the credit on the said service is allowed.
(h) Office maintenance service:
11. The said service has been used for housekeeping/maintenance of factory preemies as well as office of the factory located in the same premises, therefore the same is entitled for input service credit. Consequently, the credit on the said service is allowed.
(i) Photography service:
12. The said service has been used for taking photocopies of purchase orders for procurement of raw material, despatch of documents of final product and miscellaneous documents pertaining to accounts/audit and finance. The said service has direct nexus with manufacturing activity of the appellant. Moreover, audit and accounting service has specifically been allowed as input service. Therefore, the credit cannot be denied. Consequently, the credit on the said service is allowed.
(j) Photography service for samples of export goods manufactured by the appellant:
13. The said service has been used for taking for photographs of the samples of goods for procurement of export orders. The said service has direct nexus with manufacturing activity, clearance and export of goods for marketing and sale promotion. In that circumstance, the appellant is entitled to avail the credit on the said service.
(k) Professional and consultancy service:
13. The said service has been used by the appellant for organizing a meeting of M/s.Sarita Handa, Director in foreign for export of excisable goods. The said service is used by the appellant for marketing and sale promotion of goods manufactured by them. Therefore, the said service is having a direct nexus with manufacturing activity. Consequently, the appellant is entitled to avail the credit on the said service.
14. As discussed above, the appellant is entitled to avail the credit except the services namely, tour and travel service on which the appellant has already reversed the credit alongwith interest. In that circumstance, no penalty is imposable on the appellant.
15. With these terms, the appeal is allowed.
(Dictated & Pronounced in the open court) (ASHOK JINDAL) MEMBER (JUDICIAL) mk 1