CENVAT Credit of service tax paid on renting of branch offices, health insurance of employees upto 31/03/2011, construction services upto 31/03/2011, travel agent services and interior decorator and architect service is allowable.
Pathik Shah
M/s. Carrier Air-Conditioning and Refrigeration Ltd vs. Commissioner of Central Excise,Delhi-IV [2016-TIOL-450-CESTAT-CHD]
CENVAT Credit of service tax paid on renting of branch offices, health insurance of employees upto 31/03/2011, construction services upto 31/03/2011, travel agent services and interior decorator and architect service is allowable.
FACTS:
The Appellant paid rent for their branch offices
which assisted in procurement of order and delivery of goods and was used for
provision of erection, commissioning and repair services. Insurance services
.were availed in relation to employees who travel for business meetings, sales,
training etc. and for loss or damage to the goods.
Further, credit was availed on construction services for dismantling of
building and construction of storage shed and on travel agent service used for
travel for the purpose of business meetings, sales etc. Credit was also availed
on interior decorator and architect's services in relation to branch offices
and showrooms. The department contended that the service of renting was
utilised beyond the place of removal and the other services had no nexus with
the manufacturing activity and thus credit was denied.
HELD:
The Tribunal relying on the decision of Oracle Granito Ltd. [2013- TlOL-822-CESTAT-AHM] wherein CENVAT credit on renting of immovable property for marketing offices was allowed, it was held that such service is eligible for CENVAT credit and also considering that the premises were used for provision of services credit was allowed. Further, relying on the decision of Stanzen Toyotetsu India P Ltd [2011 (23) STR 444 (Kar.)] credit on health insurance of employees was allowed up to 01/03/2011. Insurance for loss or damage of goods was allowed to the extent they covered journey of goods up to the place of removal. In relation to construction services it was noted that as per Rule 2(1) of the CENVAT Credit Rules, 2004, input services includes service in relation to setting up, modernisation, renovation or repairs of a factory and relying on the decision of Commissioner of C. Ex. Delhi III vs. Bellsonica Auto Companies India Pvt. Ltd. [2015(40) STR 41 (P&H)] [Refer BCAJ December 2015] credit was allowed. Further relying on the decision of Good luck Steel Tubes Ltd. [2013 (32) STR 123 (Tri.-Del)] credit was allowed on travel agent's services. Credit on interior decorator and architect's services was also allowed being in the nature of modernisation/renovation or repair of factory or an office relating to such factory or premises.
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