C.C.E. Delhi-Iii vs M/S Neel Auto (P)

(Arising out of OIA No. 122/CE/DLH/2014 dated 16.6.2014 passed by CCE Gurgaon, (Haryana)

1. Whether Press Reporter may be allowed to see the Order for publication as per Rule 27 of the CESTAT (Procedure) Rules, 1982?

2. Whether it would be released under Rule 27 of the CESTAT (Procedure) Rules, 1982 for publication in any authoritative report or not?

3. Whether their Lordships wish to see the fair copy of the order?

4. Whether order is to be circulated to the Department Authorities?

C.C.E. Delhi-III Appellant

Vs.

M/s Neel Auto (P) Respondent

Appearance:

Present for the Appellant: Shri R.K. Gupta, DR

Present for the Respondent: Shri S.K. Pahwa, Advocate

Coram: Honble Ms. Sulekha Beevi C.S., Member (Judicial)

Final Order No.52218/2015

Per: Sulekha Beevi C.S.

The Revenue is in appeal aggrieved by the allowance of Cenvat Credit on Catering Services.

1. The respondents are engaged in the manufacture of Two Wheeler Parts and they are also availing Cenvat credit facility under the Cenvat Credit Rules, 2004. A Show cause notice dated 7.4.2011 was issued to them alleging that the respondents wrongly availed and utilized the Cenvat credit of Rs.9,35,580/- on service of outdoor Catering service for the period 2008-2009 & 2009-2010. The Show Cause Notice finalized in the Order-in-Original which confirmed the disallowance of credit. The Primary adjudicating authority denied the credit on the ground that in the salary slip of one employee an amount of Rs.276/- was collected on the head canteen charges. The respondents filed an appeal, and the Commissioner (Appeals) after perusal of the records has found that the deduction of Rs.276/- towards canteen charges from the salary of one employee cannot be a ground to deny the claim of credit, as the balance sheet of the respondents establish that the respondents were incurring the canteen expenses.

2. The learned DR assailed the impugned order and contended that the credit on this service cannot be allowed. He also relied upon the decision of Ultratech Cement Ltd. Vs. CCE, Nagpur 2010 (260) E.L.T. 368 (Bom.). Against this Ld. Counsel for the respondents submitted that the issue that the respondents collected expenses from the employees was not raised in the Show Cause Notice. That the original adjudicating authority has traveled beyond the show cause notice and denied the benefit to the respondents.

3. Heard both sides and perused the records. I find that there some substance in the arguments advanced by the counsel for respondents. The show cause notice does not allege that the respondents have been collecting amounts from the employees. The original adjudicating authority has relied on a single salary slip in which Rs.276/- has been charged as canteen charges, and denied credit of Rs.9,35,580/- towards catering services. The Commissioner (Appeals) has observed that the balance sheet of the respondents for the period 2007-08 to 2010-2011 shows that the respondents have incurred expenses of Rs.32,29,583/-, Rs.47,23,412, Rs.41,30,997 and Rs.78,88,902/- towards staff and workers welfare. Therefore it shows that expenses are incurred by the respondents. A single salary ship showing a meager amount of Rs.276/- is too feeble to be relied when the appellants have properly accounted the expenses in these heads in their books of accounts.

4. In view there of, I do not find any infirmity in the impugned order. The appeal filed by Revenue is dismissed.

(Dictated and pronounced in the open Court)

(Sulekha Beevi C.S.)

Member (Judicial)

K. Gupta

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