Cenvat credit on outdoor catering for factory employees accepted as an input service under prior High Court rulings

Service tax paid on outdoor catering services used to provide food to employees in factory premises was treated as eligible for Cenvat credit as an input service, following earlier Madras HC decisions on the same issue. The Court clarified that the worker's share of the food cost was not relevant to the credit claim. On that basis, entitlement to Cenvat credit on the catering service was upheld in favour of the assessee and against the Revenue.

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Issues: Whether service tax paid on outdoor catering services used for providing food to employees in the factory premises was eligible for Cenvat credit as an input service.

Analysis: The issue was treated as covered by earlier decisions of the same Court holding that catering services used for providing food to employees in the factory could qualify as input services for the purpose of Cenvat credit. The Court also clarified that the cost of food borne by the worker was not to be taken into consideration while granting such credit.

Conclusion: The entitlement to Cenvat credit on service tax paid to the outdoor caterer was answered in favour of the assessee and against the Revenue.

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