Custom, Excise & Service Tax Tribunal
M/S Meghmani Dyes And Intermediates ... vs Commissioner Of Central Excise ... on 20 February, 2018
In The Customs, Excise & Service Tax Appellate Tribunal West Zonal Bench At Ahmedabad ~~~~~ Appeal No : E/11766/2017 (Arising out of OIA No. AHM-EXCUS-001-APP-019-2017-18 dated 13.07.2017 passed by Commissioner (Appeals) of Central Excise-Ahmedabad-I) M/s Meghmani Dyes And Intermediates Limited : Appellant (s) Vs Commissioner of Central Excise Ahmedabad-I : Respondent (s)
Represented by:
For Appellant (s) : Shri H. Maheshwari, Advocate For Respondent (s): Shri J. Nagori, AR CORAM :
Dr. D. M. Misra, Hon'ble Member (Judicial) Date of Hearing/Decision: 20.02.2018 ORDER No. A/10477 / 2018 Per : Dr. D. M. Misra Heard both sides.
2. This is an appeal filed against the order-in-appeal No. AHM-EXCUS-001-APP-019-2017-18 dated 13.07.2017 passed by Commissioner (Appeals) of Central Excise-Ahmedabad-I.
3. The short issue involved in the present appeal is: whether the appellant are entitled to credit of service tax paid on various insurance policies, namely, Medical Insurance, Accidental Insurance and Group Insurance Policy relating to Group Gratuity and Motor Vehicle Insurance and also credit of service tax paid on services relating to Staff Welfare Expenses, Food and Beverages etc. during the relevant period.
4. The Ld. Authorised Representative Shri H. Maheswari, General Manager for the appellant submits that the service tax paid on the premium of insurance policies viz. Group Insurance Policies taken for the employees, Insurance Policy in discharging gratuity etc., are admissible to credit in view of the judgement of the Honble Karnataka High Court in the case of Commissioner of C. Ex. & S. T, LTU, Bangalore vs. Micro Labs Ltd. 2012 (26) STR 383 (kar.) and this Tribunal in the cases of Ion Exchange India Ltd. Vs. Commissioner of Central Excise, Bharuch vide final order No. A/10401/2018 dated 20.02.2018. Also, he submits that the credit of service tax paid on various staff welfare policies is also admissible to credit.
5. Ld. AR for the Revenue submits that after 01.4.2011 the definition of Input Service has been amended and insurance policies on Motor Vehicle is no more an input service and hence not admissible to credit. It is his contention that credit availed on staff welfare expenses, food and beverages and motor vehicle insurance are therefore not admissible to credit.
6. In his rejoinder, the Authorised Representative does not dispute on the issue of inadmissibility of credit on the service tax paid on staff welfare expenses, food and beverages and motor vehicle insurance policies.
7. I find that the Honble Karnataka High Court in Micro Labs Ltds case (supra) and this Tribunal in the aforesaid case held that the credit of service tax paid on the premium of various insurance policies taken for employees under the Labour Laws, is admissible to credit. Therefore, the credit availed on the service tax paid on the premiums of insurance policies for the employees, in the course of discharging their duty as required under the provisions of Labour Laws are admissible to credit. Further, admittedly the credit on staff welfare expenses, food and beverages and on motor vehicle insurance, is not admissible. In the result, the impugned order is modified to the above extent and appeal is partly allowed.
(Dictated and pronounced in the open Court) (D. M. Misra) Member (Judicial) G.Y. 3 Appeal No. E/11766/2017