Custom, Excise & Service Tax Tribunal
Cce, Visakhapatnam-I vs M/S. Bhpv Ltd on 13 January, 2016
CUSTOMS, EXCISE AND SERVICE TAX APPELLATE TRIBUNAL REGIONAL BENCH AT HYDERABAD Bench SMB Court I Appeal No.E/1493/2010 (Arising out of Order-in-Appeal No.18/2010 (V-I) CE dt. 23/03/2010 passed by CCE&C(Appeals), Visakhapatnam) 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? CCE, Visakhapatnam-I ..Appellant(s) Vs. M/s. BHPV Ltd. ..Respondent(s)
Appearance Shri S.V. Nair, Authorised representative for the appellant.
Shri Karan Talwar, Advocate for the respondent.
Coram:
Honble Ms. Sulekha Beevi, C.S., Member(Judicial) Date of Hearing:13/01/2016 Date of decision:13/01/2016 FINAL ORDER No._______________________ [Order per: Sulekha Beevi, C.S.] The Revenue is in appeal against the order passed by Commissioner(Appeals) allowing the credit availed on the service tax paid in regard to security services, taxi/tour services, professional / Chartered Accountant services, event management services, insurance services and travel agency service.
2. At the outset it has to be stated that the period involved in the case is prior to 01/04/2011 when the definition of input services had a wide ambit as it included the words activities relating to business. The Honble Bombay High court in the case of Coca Cola India (P) Ltd. Vs. CCE, Pune-III [2009(15) STR 657 (Bom.)] observed that the expression business is an integrated / continuous activity and is not confined / restricted to mere manufacture of the product. Therefore activities in relation to business can cover all the activities that are related to the functioning of a business of manufacture. As per the inclusive clause of the definition of input services, it would be enough if the services are utilized in or in relation to their business activities.
3. With this precedential background of the definition of input services, let me narrate the facts of the case. The respondents are manufacturers of heavy machinery items and other items and are availing CENVAT credit facility. During the period May 2008 to November 2008, it was noticed that respondents had wrongly availed credit of service tax paid on 1) security services, 2) taxi / tour services, 3) professional / consultant services, 4) event management services, 5) insurance services and 6) travel agent services. A show-cause notice dt. 02/06/2009 was served on the respondents proposing to recover the wrongly availed credit along with interest and also proposed penalty. After adjudication the adjudicating authority allowed credit partly on Chartered Accountant service and travel agent service and disallowed the rest, besides imposing penalty of Rs.2000/- under Rule 15(3) of CENVAT Credit Rules, 2004. Being aggrieved, the respondents filed appeal before the Commissioner(Appeals). The Commissioner(Appeals) set aside the order-in-original and allowed the credit. The Revenue is thus before the Tribunal.
4. On behalf of the Revenue, the learned AR strongly argued that the security services were availed for security / safety of the township and contended that the said services would not qualify as input services as there is no nexus with the manufacturing activity of the respondent. The respondent produced a letter from the service provider stating that the security service was provided to the factory premises of appellant. In Reliance Industries Ltd. Vs. CCE&ST(LTU), Mumbai [2015-TIOL-2343-CESTAT-MUMBAI], the Tribunal allowed the credit on service tax paid on various services utilized for residential colony / township of the appellant factories therein. The residential colony is set up for the employees of the factory of respondent. Therefore setting up of residential colony and maintaining it would fall under the category of activities relating to business. The authorities below have relied on the judgment in Manik Garh Cement case [2010(20) STR 456 (Bom.)]. The Honble Bombay High Court in that case placed reliance on the judgment in Maruti Suzuki Ltd. Case [2009(240) ELT 641 (SC)] in which in fact the Honble Apex Court was considering the issue of inputs and not input services. The same Court in CCE, Nagpur Vs. Ultratech Cement Ltd. [2010(20) STR 577 (Bom.)] has held that unlike the definition of input, which is restricted to the inputs used directly or indirectly in or in relation to the manufacture of final products, the definition of input service not only means services used directly or indirectly in or in relation to manufacture of final products, but also includes services used in relation to the business of manufacturing final products.
5. From the foregoing, I am of the view that the first appellate authority has rightly allowed the credit on security services. As regards the credit availed on other services, the issue is settled by umpteen number of judgments. HCL Technologies Ltd. Vs. CCE, Noida [2015((40) STR 369 (Tri. Del.)], Jaichemicals Vs. CCE, Delhi [2015(40) STR 345 (Tril. Del.)] are some of them. Considering the facts, evidence and the precedents as stated above, I find that the impugned order calls for no interference.
6. In the result, the appeal is dismissed.
(Operative portion of this order was pronounced in court on conclusion of the hearing) SULEKHA BEEVI C.S. MEMBER(JUDICIAL) Raja.
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