Custom, Excise & Service Tax Tribunal
Shree Kamrej Vibhag Sahakari vs Commissioner Of Central ... on 24 June, 2015
In The Customs, Excise & Service Tax Appellate Tribunal West Zonal Bench At Ahmedabad ****
Appeal No : E/10017/2013 (Arising out of OIA-CCEA-SRT-II-SSP-94-U-S35A-3--FINALORDER- Dated 19/11/2012 passed by Commissioner of Central Excise-SURAT-II) Shree Kamrej Vibhag Sahakari Khand Udyog Mandali Limited Appellant (s) Vs Commissioner of Central Excise-SURAT-II : Respondent (s) Represented by:
For Appellant (s) : Ms. Shilpa Balani, Advocate For Respondent (s) :Shri S Shukla, Authorised Representative For approval and signature: Mr. H.K. Thakur, Honble Member (Technical) 1.
Whether Press Reporters may be allowed to see the Order for publication as per Rule 27 of the CESTAT (Procedure) Rules, 1982?
No
2. Whether it should 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 Departmental authorities?
Yes
CORAM:
MR. H.K. THAKUR, HONBLE MEMBER (TECHNICAL)
Date of Hearing/Decision: 24.06.2015
Order No. A/10914 / 2015 Dated 24.06.2015
Per: H.K. Thakur
This appeal has been filed by the appellant with respect to O.I.A. CCEA-SRT-II/SSP-94/U/S/ 35A (3) (Final Order) Dated 19.11.2012. The issue involved in the present proceedings is whether CENVAT credit paid on services relating to membership of a club will eligible as input service credit under Rule 2(l) of the Central Excise Rules, 2004, and whether a document on which service tax is paid for the earlier period can be considered as proper documents for availing CENVAT credit.
2. M/s Shilpa Balani (Advocate) appearing on behalf of the appellant argued that the credit amount is Rs. 1,53,171/- and is admissible as per the case law of BCH Electric Ltd. vs Commissioner of Central Excise, Delhi-IV [2013 (31) S.T.R. 68 (Tri. Del.). So far as CENVAT credit for the period 2005-2006, 2006-2007 and 2007-2008 issued under documents after the date of registration is concerned, she argued that such credit is admissible as it has been consistently held by the Courts that Technical/Procedural irregularities cannot be made as the ground for denying CENVAT credit. She relied upon the case law of Collector of Central Excise & Customs vs Amal Rasayan Ltd. [1993 (68) E.L.T. 446 (Tribunal) and CBEC Board Circular No. 441/07/99-CX Dated 23.02.1999. She also made the Bench go through the activities of Gujarat State Federation of Co-up. Sugar Factories Ltd., who are providing services to the appellant. That according to the activities provided by the service provider the same are in relation to their manufacturing activity.
3. Shri S. Shukla, (AR) appearing on behalf of the Revenue argued that membership of club is not a service in relation to the manufacturing activity and no credit is admissible. So far as admissibility of credit of the past period is concerned, it was his case that no service tax paid by the appellant period a date of registration is admissible as CENVAT credit.
4. Heard both sides and perused the case records. The issue involved in the present proceeding is whether CENVAT credit with respect to services of membership of club is admissible under Rule 2(l) of the Central Excise Rules, 2004 or not. Appellant has relied upon the case of BCH Electric Ltd. vs Commissioner of Central Excise, Delhi-IV, wherein it has been held that services of club membership of India International Centre and IEEMA New Delhi, are admissible as CENVAT credit as per Para 6 of this case law as relation is reproduced below:-
6.?So far as the service of club membership is concerned, the appellant were availing this service from India International Centre and IEEMA. In respect of membership of IEEMA, the appellants plea is that this is an association of engineering products manufacturers and the association provides the market related information, information about new technology, etc., to its members which is essential to carry out business and such information is the basic need of an industry to stand in competition in the market. I am of the view that there is merit in the appellants plea. As such membership of this club would be covered by the definition of input services. However, appellant has not shown as to how the membership of India International Centre, New Delhi has the nexus with the manufacturing business and as such the services tax paid on the membership fee of this club is not cenvatable.
5. In view of the above, CENVAT credit has been a rightly claimed by the appellant as the activities provided are in relation to manufacturing the products of the appellant. So far as taking of CENVAT credit after registration for the earlier period is concerned, it is relevant to mention that once there is a nexus between the services received and the manufacturing activity undertaken by the appellant minor Procedural Lapses / Irregularities cannot be held to be any adverse effect on taking CENVAT credit. It is observed from the activities of Gujarat State Federation of Co-up. Sugar Factories Ltd., that service provider is providing technical support and guidance to the members for expansion renovation and modernization of the units and also assist to undertaken research work for better quality of Sugar etc.
6. In view of the above observations, appeal filed by the appellant is allowed with consequential relief, if any.
(Operative portion of the order pronounced in Court) (H.K. Thakur) Member(Technical) govind 4