India Tube Mills & Metal Industries Ltd vs Commissioner Of Central Excise

IN THE CUSTOMS, EXCISE & SERVICE TAX APPELLATE TRIBUNAL,WEST ZONAL BENCH AT MUMBAI

COURT No. II

APPEAL No.E/1608/10

(Arising out of Order-in-Appeal No.PKS/90/BEL/2010 dated 03/06/2010 passed by Commissioner of Central Excise, Belapur, Navi Mumbai)

For approval and signature:

Honble Mr. Raju, Member (Technical)

1. Whether Press Reporters may be allowed to see :No 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 :Yes CESTAT (Procedure) Rules, 1982 for publication in any authoritative report or not?

3. Whether Their Lordships wish to see the fair copy :Seen of the Order?

4. Whether Order is to be circulated to the Departmental :Yes authorities? ========================================

India Tube Mills & Metal Industries Ltd., Appellant Vs. Commissioner of Central Excise, Respondent Mumbai

Appearance:

Shri.Arpit Jain, CA for appellant Shri.H.M. Dixit, Asst. Comm. (AR), for respondent

CORAM:

Honble Mr. Raju, Member (Technical)

Date of Hearing : 21/09/2015 Date of Decision : 21/09/2015

ORDER NO

Per: Raju

1. The appellants having denied Cenvat Credit of service tax paid on cellular services, insurance premium of vehicles used by their employees and by the company. The credit has also been denied on individual health and accident policy. The Commissioner (Appeals) while denying the credit has observed as follows:

I have gone through the facts of the case, records available in the file and the submissions made during the personal hearing. I find that the appellants have not given any evidence or documents, whatsoever, in support of the claim in the appeal except contending that the definition of input service is wide enough to include the credit claimed. While not denying the fact that service tax paid on mobile charges, insurance charges, etc. need to be credited, yet to claim the benefits; they have to provide documentary proof in support of the same. In absence of the same, it may not be possible to ascertain that the same has been used in or in relation to manufactured product or providing output service. The Honble CESTAT in the case of Force Motors Ltd. Vs. CCE, Pune-I (2009 (16) STR 616) has held that:

7.?During adjudication the Asst. Commissioner found that the appellants have submitted some sample copies of vehicle duty slip details, monthly debit of mobile charges to officers personal account. In the case of vehicles duty slip it was observed that certain details like requisition from whom and date, name of the department etc. were kept blank. Therefore it cannot be verified that the vehicles were used exclusively for business purpose only. Regarding the mobile phones it was clarified that the companies debit the employee account on monthly basis whenever the bills exceed the limit of the mobile bill allotted to them. Therefore it could not be verified that the call made within the permissible limits were for official purposes only.

8.?After going through the facts and circumstances of the case, I am of the opinion that as per C.B.E.& C. Circular No. 97/8/2007-S.T., dated 23-8-2007, credit of service tax paid in respect of mobile phone is admissible provided the mobile phone is used for providing output service or used in or in relation to manufacture of finished goods. In the facts of this case the Asst. Commissioner drew an inference from the statement of Shri V.S. Khasnis, the officer of the appellants that when there is no check on use it means this service are being used for the personal work of the employees. Further he did not verify from the records that the debit made to the employees in their account on account of excess use of mobile phones beyond their limit and the same is the case of vehicles. He has also not verified the purpose for which the vehicles are being used.

In the case in hand, the appellant could not produce relevant documents to support their contention that the services in question are used in or in relation to manufacture of final goods or in output services to the adjudicating authority. Accordingly, the appeal cannot succeed.

2. The learned Counsel for the appellant submitted that their case is squarely covered by the decision of this Tribunal in the case of Muscat Polymers Pvt. Ltd., Vs. CCE, Rajkot vide Final Order Nos.A/1670-1671/2011-WZB/AHD dated 26/09/2011 in Appeal Nos.ST/488 & 400/2010. They also submitted that in the written submission given after attending personal hearing on 11/05/2009 they had submitted the evidence regarding use of said services along with supporting documents.

3. The learned AR reiterated the findings given in the appeal memorandum.

4. It is seen that the primary reason for denying the credit in the impugned order is failure to produce relevant documents to support the contention that the services are used in or in relation to the manufacture of final products or in output services. It is seen that after personal hearing, the appellant had indeed submitted the said evidence and the same could not be considered while passing the order. The appellants produced a copy of their letter dated 02/06/2010 wherein they have submitted the bills of telephone and insurance papers. The same have not been considered in the order.

5. In view of the above facts, the appeal is allowed by way of remand. The Commissioner (Appeals) would consider the evidence submitted by the appellants and decide the case after following the principles of natural justice.

(Dictated in Court)

(Raju) Member (Technical)

pj

1 4