Cipla Ltd vs Commissioner Of Central Excise ...
- CitationAppeal No. 139-2011-CE
Ratio decidendi
The rule this decision rests on
The CENVAT credit on input services is admissible where the service, here travel agent service used to transport employees between their residences and the office, is utilised for the manufacturer's business activities, so that it qualifies as an input service in relation to the manufacture of the excisable goods; the credit cannot be denied merely because the invoice describes the service by a label such as "travel agent service", the actual use of the service being determinative. Credit on outdoor catering service is not to be allowed in full without verification; where the assessee has recovered an amount from employees for subsidised food, the credit attributable to that recovered amount is not admissible, and the quantum must be re-determined by the adjudicating authority.
Written by Miss Lucy from the judgment below, not taken from a headnote.
Judgment
As delivered
[Arising out of Order-in-Appeal No. 139-2011-CE dated 26/04/2011 passed by CCE(Appeals-I), Bangalore]
For approval and signature:
HON'BLE SHRI B.S.V.MURTHY, TECHNICAL MEMBER
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 Lordships wish to see the fair copy of the Order?
4 Whether Order is to be circulated to the Departmental authorities?
CIPLA LTD OLD MADRAS ROAD, VIRGONAGAR, BANGALORE Appellant(s)
Versus
Commissioner of Central Excise ,Customs and Service Tax BANGALORE-I NULL POST BOX NO 5400...CR BUILDINGS, BANGALORE, - 560001 KARNATAKA Respondent(s)
Appearance:
Shri B. Raghavendra and Shri L.S. Karthikeyan, Advocates For the Appellant
Shri N. Jagdish, Superintendent(AR) For the Respondent
Date of Hearing: 10/03/2015
Date of Decision: 10/03/2015
CORAM:
HON'BLE SHRI B.S.V.MURTHY, TECHNICAL MEMBER
Final Order No. 20610 / 2015
Per : B.S.V. MURTHY
The appellant has a manufacturing unit in Bangalore where they manufacture pharmaceutical products which are sold locally as well as in overseas markets. The appellants availed and utilised CENVAT credit of tax paid on input services and taking a view that appellants are not eligible for CENVAT credit in respect of travel agent service, courier service, outdoor catering service and authorized service station service, impugned order has been passed denying the credit and demanding the same with interest. Penalty under Section 11AC equal to the CENVAT credit demanded has also been imposed. Period is December 2007 to January 2009.
2. The learned counsel submits that the travel agent service was utilised for bringing the employees from their residences to the office even though it has been mentioned as travel agent service. He relies on the decisions in the cases of CCE, Bangalore-III Vs. Stanzen Toyotetsu India (P) Ltd. [2011(23) STR 444 (Kar.)], Cadmach Machinery Co. (P) Ltd. Vs. CCE, Ahmedabad [2013(31) STR 33 (Tri. Ahmd.)] and in Dr. Reddys Lab. Ltd. Vs. CCE, Hyderabad [2010(19) STR 71 (Tri. Bang.)] to submit that all these services are covered and in the decisions it has been held that CENVAT credit is admissible. After considering the use of the services and the purpose for which they have been utilised by the appellant and the decisions relied upon, I have come to the conclusion that the claim of the appellants for CENVAT credit cannot be denied. However, in respect of outdoor catering service, there is a need to verify whether full credit is admissible by checking whether the appellant company has realized any amount for providing subsidized food to their employees. For this limited purpose, the matter has to be remanded.
3. In view of the above discussion, the claim for CENVAT credit in respect of all the services is held to be admissible but in respect of outdoor catering service the matter is remanded to the original adjudicating authority for checking up whether the appellant is entitled to the amount which has been claimed (re-quantification). The appeal is disposed of in above terms.
(Order pronounced and dictated in open court)
B.S.V.MURTHY TECHNICAL MEMBER
Raja 3
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