Custom, Excise & Service Tax Tribunal
M/S. Cmc Ltd vs Cce&St, Hyderabad-I on 29 February, 2016
CUSTOMS, EXCISE AND SERVICE TAX APPELLATE TRIBUNAL REGIONAL BENCH AT HYDERABAD Bench SMB Court I Appeal No.ST/2073/2012 (Arising out of Order-in-Appeal No.63/2012 (H-IV) S.Tax dt. 22/03/2012 passed by CC,CE&ST(Appeals-II), Hyderabad) For approval and signature: Honble Ms. Sulekha Beevi, C.S., Member(Judicial) 1. Whether Press Reporters may be allowed to see 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 CESTAT (Procedure) Rules, 1982 for publication in any authoritative report or not? 3. Whether their Lordship wish to see the fair copy of the Order? 4. Whether Order is to be circulated to the Departmental authorities? M/s. CMC Ltd. ..Appellant(s) Vs. CCE&ST, Hyderabad-I ..Respondent(s)
Appearance None for the appellant.
Shri Raj Kumar, Authorised representative for the respondent.
Coram:
Honble Ms. Sulekha Beevi, C.S., Member(Judicial) Date of Hearing:29/02/2016 Date of decision:29/02/2016 FINAL ORDER No._______________________ [Order per: Sulekha Beevi, C.S.] The issue involved is the disallowance of credit on input services on the allegation that the input services do not have nexus with output services.
2. The appellant is engaged in providing wide spectrum of IT solutions and services to its clients. Pursuant to an audit, it was observed that appellants availed irregular credit on input services for the period 2008-09 to 03/2011. The department observed that input service credit on services like advertisement services, corporate management fee, event management, insurance service, printing service is not available as these services do not have nexus with output services. A show-cause notice was issued raising demand of Rs.1,71,132/- along with interest and proposing to impose penalty. After adjudication, the original authority confirmed the demand along with interest and imposed equal amount of penalty. The appellants filed appeal before the Commissioner(Appeals) who vide the order impugned herein upheld the same. Hence the appellants are before the Tribunal.
3. The appellants filed written submissions and requested to consider the appeal according to the grounds stated in the appeal in their absence. I have heard the submissions put forward by the learned AR Shri Raj Kumar and also gone through the written submissions filed by appellant.
4. The issue involved is the denial of credit on input services alleging that these services are not essential for rendering the output services. The period involved is prior to 01/04/2011 when the definition of input service had a wide ambit as it included the words activities relating to business. It is explained by the appellant that the insurance services (medi-claim and property related general insurance services) were availed for safety of employees as well as insurance of premises of the appellant establishment. The corporate management fee/ professional membership fee was availed as the appellant is a member of the India Semiconductor Association which is the premier trade body representing the Indian Electronic System Design & Manufacturing Industry. That such membership is related to the output services of the appellant. The charges for advertisement services was incurred for participating and putting up a kiosk at the Embedded System Conference at Bangalore for IT professionals. Printing works and event management were incurred for printing of posters and for the purpose of organizing the team building for the employees of the company. That these services are related to the activities of business of providing output service.
5. The issue is no longer res-integra. In Coco-cola India Ltd. Vs. Commissioner, Pune-III [2009(242) ELT 168 (Bom.)], Computer Sciences Corp. India (P) Ltd. Vs. CCE&ST, Noida [2015-TIOL-2123-CESTAT-DEL], CCE Vs. HCL Technologies [2015(37) STR 716 (All.)], the Courts as well as the Tribunal has held these services to be eligible for credit. Form the facts presented by the case and following the ratio laid in the above judgments, I find that the credit on the alleged services is admissible. In the result, the impugned order is set aside. The appeal is allowed with consequential reliefs, if any.
(Operative part of this order was pronounced in court on conclusion of the hearing) SULEKHA BEEVI C.S. MEMBER(JUDICIAL) Raja.
4