Custom, Excise & Service Tax Tribunal
M/S.Lg Electronics (India) Pvt.Ltd vs Cce, Noida on 30 June, 2015
CUSTOMS, EXCISE & SERVICE TAX APPELLATE TRIBUNAL,
WEST BLOCK NO.II, R.K. PURAM, NEW DELHI-110066.
SINGLE MEMBER BENCH
Court No.III
Appeal No. E/54154/2014-SM
(Arising out of OIA NOI/EXCUS/000/APPL/41/14 dt.21.2.14 passed by CCE(A), Noida)
Date of Hearing 17.06.2015
Date of Order: 30.6.2015
For approval & Signature:
Honble Smt.Sulekha Beevi C.S., 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.LG Electronics (India) Pvt.Ltd. Appellant
Vs.
CCE, Noida Respondent
Appearance:
Present for the Appellant: Ms.Sukrit Das, Advocate Present for the Respondent: Shri R.K.Grover, AR Coram: Honble Smt.Sulekha Beevi C.S., Member (Judicial) Final Order No.52053/2015 Per: Sulekha Beevi C.S. The appellant is engaged in the manufacture of electronics goods. The appellant is also providing/receiving taxable services in respect of categories such as repair and maintenance, commissioning & installation, consulting engineer, online information and data access and retrieval, transport of goods by road, intellectual property rights etc. The appellant availed Cenvat Credit of duty paid on the inputs and input service used in relation to the manufacture of their final products cleared on payment of duty and for providing taxable output services. For transportation of employees, the appellant availed rent-a-cab service as a transportation facility. This facility was used for transportation of their employees to and fro from the factory and also used for other business purposes of the appellant. An amount of Rs.40,00,485/- was availed as Cenvat Credit of service tax paid on rent-a-cab services, for the period from January, 2008 to March, 2011. The appellant was issued a show cause notice dated 8.11.2011 proposing disallowance of Cenvat Credit taken on rent-a-cab services and recovery of the same. After adjudication, the Order-in-Original dated 8.7.2013 was passed disallowing Cenvat Credit of Rs.40,00,485/- of service tax paid on rent-a-cab service and also imposed equal penalty alongwith interest. Aggrieved with the said order, the appellant filed appeal before the Commissioner (Appeals) which was dismissed. Hence this appeal.
2. The learned Counsel appearing for the appellant submitted that whether rent-a-cab qualifies as input service to avail Cenvat Credit has been decided in a plethora of decisions. She also urged that the view taken by the Commissioner (Appeals) that rent-a-cab service, does not qualify as input service, in as much as, it has no nexus with the activity of manufacturing of final products by the appellants is without any basis. According to her, the definition of input service, in Rule 2(l) of Cenvat Credit Rules, 2004 has a wide scope and therefore any service used in or in relation to the business of manufacture of goods would get covered under the definition of input service. The disputed period is from January, 2008 to March, 2011. She drew attention to Notification No.3/2011-CE (N.T.) dated 01.03.2011, where w.e.f.1.4.2011 rent-a-cab services are expressly excluded from the purview of the definition of input services under Rule 2(l) of Cenvat Credit Rules. To substantiate her contentions, she relied upon the following decisions:
(1) CCE, Bangalore-I vs. Stanzen Toyotetsu India(P) Ltd.- 2011 (23) STR 444 (Kar.) (2) CCE, Bangalore-I vs. Bell Ceramics Ltd.-2012 (25) 428 (Kar.) (3) CCE, Bangalore-III vs. Tata Auto Comp Systems Ltd.-2012 (277) ELT 315 (Kar.) (4) CCE, Federal Mougul Goteze (India) Ltd.-2011-TIOL-650-HC-P&H-ST (5) Coca Cola India Pvt.Ltd. vs.CCE, 2009 (15) STR 657 (Bom.)
3. Against this, the learned AR contended that rent-a-cab service does not have nexus between the manufacturing activity and therefore does not qualify to be input service on which Cenvat Credit can be availed.
5. The issue whether rent-a-cab service would qualify as input service for availing Cenvat Credit has been settled in various decisions. As per Notification No.3/2011-CE(NT) dated 1.3.2011, rent-a-cab service is expressly excluded from the purview of the definition of input service under Rule 2(l) of Cenvat Credit Rules, 2004 with effect from 1.4.2011, In the present case, the period being prior to 1.4.2011. I do not find any reason to disallow the claim of the appellant to avail Cenvat Credit on rent-a-cab service for the period from January, 2008 to March, 2011. The Circular No.943/4/2011-CX dated 29.4.2011 issued by the Board that the service of rent-a-cab service received before 1.4.2011 would be eligible for Cenvat Credit if its provision had been completed before1.4.2011 would also assist the appellants. This being so, the plea of the Department that rent-a-cab service has no nexus with the activity of manufacture of final products and Cenvat Credit is not admissible on such services is unacceptable. The learned Counsel has also raised the plea of limitation which was also contested. As the substantial issue is held in favour of the appellant, I do not think it necessary to enter into this issue.
6. In view of above, I find that the impugned order is unsustainable. The same is set aside and the appeal is allowed.
(pronounced in open court 30.6.2015) (Sulekha Beevi C.S.) Member (Judicial) mk 4