IN THE CUSTOMS EXCISE AND SERVICE TAX APPELLATE TRIBUNAL
WEST ZONAL BENCH, AHMEDABAD
Appeal No. E/10851/2018-SM
Arising out of OIO No. VAD-EXCUS-002-APP-732-2017-18, Dated: 22.12.2017
Passed by Commissioner (Appeals) Commissioner of Central Excise, Customs and Service Tax-Vadodara-I
Date of Hearing: 28.12.2018
Date of Decision: 13.02.2019
STYROLUTION ABS INDIA PVT LTD
COMMISSIONER OF CENTRAL EXCISE AND SERVICE TAX
Appellant Rep by: Shri Jigar Shah, Adv.
Respondent Rep by: Shri Amit Kumar Mishra, Asst. Commr. AR
CORAM: Raju, Member (T)
CX – The assessee-company availed Cenvat credit on input services such as Chartered Accountancy Services, IT service and manpower service for providing maintenance staff at their headquarters at Mumbai – The Revenue sought to deny such credit on grounds that these services were not used in the assessee’s manufacturing unit located in Gujarat – Hence the present appeal.
Held: The CA services & management consultancy services were claimed to be used for statutory audit and accounting of the operation – Hence these services are specifically included in the definition of input services – Similarly, the advisory services were claimed to have been used for insurance of goods – Both services are otherwise covered in the inclusive part of the definition of input services – Moreover, it is seen that the requirement for distribution of input credit arises only if there are more than one factory premises in respect of which the input services are received at a place – In the present case, the assessee has only one factory & thus the issue of distribution of input credit does not arise – Hence the O-i-O in question merits being quashed: CESTAT
Assessee’s appeal allowed
Case law cited:
Styrolution India ABS Pvt Ltd – 2018-TIOL-641-CESTAT-AHM…Para 2.2
FINAL ORDER NO. A/10258/2018
This appeal has been filed by Styrolution India Pvt. Ltd. (SIPL) against denial of Cenvat Credit, demand of interest and imposition of penalty.
2. Ld. Counsel for the appellant pointed that the appellant availed CENVAT Credit on input services in respect of Chartered Accountancy Services, IT service and manpower service for providing maintenance staff at their Mumbai Headquarter during the period July, 2016 to March 2017. The said credit has been sought to be denied on the ground that the said services were not used in the manufacturing unit of the appellant which is located in Bharuch, Gujarat.
2.2 Ld. Counsel pointed out that in respect of different services namely the services of renting of immovable property, the identical issue has been decided by this Tribunal vide order reported in 2018 (1) TMI 299-CESTAT Ahmedabad = 2018-TIOL-641-CESTAT-AHM in their own case. He argued that there is no restriction regarding the use of services within the factory premises in the definition of input services. He pointed out that in the instant case, credit has been sought to be denied in the services of Chartered Accountancy, management consultancy and insurance brokerage advisory (Insurance Auxiliary Services).
2.3 He pointed out that in respect of Chartered Accountancy services, the benefit was allowed in the Order-in-Original. In para 10.3.11, while confirming the demand, the demand made in respect of CA services has also been confirmed on the ground that said service was obtained outside the factory premises and there is no registration of the said office as input service distributors. He pointed out that the management consultancy services were for acquiring two plants.
2.4 It is seen that there is no specific discussion on admissibility of CENVAT Credit on management consultancy services and insurance broker advisory services. Ld. Counsel clarified that the management consultancy services has been obtained for setting up/acquisition of new plants and would be covered in the inclusive part of definition of the input service. He further argued that they have only one factory, and, therefore, argue that they have only one factory and, therefore, there is no question of distribution of input services. He argued that in absence of more than one factory, there is no need for registration of the Head Quarter as input services distributors. He also argued that the management consultancy service was used for statutory auditing and certification of accounts and thus, credit on same cannot be denied. He further argued that insurance advisory service was used for insurance of goods and thus, credit on the same also cannot be denied.
3. Ld. AR relies on the impugned order.
4. I have gone through rival submissions. I find that credit has been denied on the following services:
|S no.||Nature of Input Service||Use of Services||Total (in Rs.)||Time period|
|01.||Chartered Accountants/Management Consultants Services||Statutory Audit fees for Auditing, Certification of Accounts||41,370.00/-||July 2016, March, 2017|
|02.||Insurance Advisory Services||For Insurance of Goods & P& M||8400.00/-||July 2016, March, 2017|
It is seen that the CA services and management consultancy services have been claimed to be used for statutory audit and accounting of the operation. Thus, these services are specifically included in the definition of input services. Similarly, insurance advisory service has been claimed to be used for insurance of goods. It is seen that both these services are otherwise covered in the inclusive part of definition of input services.
4.2 The second objection raised by Revenue relates to the place where these services have been obtained and on the ground that the said place is not registered as input service distributor. It is seen that the requirement for distribution of input credit would arise only if there are more than one factory premises in respect of which the input services are received at a place. In the instant case, the appellant have only one factory premises and thus, the question of distribution of input credit does not arise. In these circumstances, I do not find any merit in the impugned order and the same is set aside and appeal is allowed.
(Pronounced in the open Court on 13.02.2019)