2017 (3) TMI 1542 - AT - Central Excise

Appellant wins appeal for cenvat credit on air travel, tour operator, and club fees

ITC Ltd. Versus Commissioner of Central Excise, Service Tax And Customs Bangalore-iv Bangalore

The Judicial Member allowed the appellant's appeals, setting aside the impugned order denying cenvat credit on services such as Air Travel, Tour Operator, ... CENVAT credit - Air Travel service - Tour Operator service - Membership Fee of their association and clubs - Held that: - these input services are integrally connected with the business of the company - the issue is squarely covered in favour of the appellant by various decisions - appeal allowed - decided in favor of appellant. Issues involved:Appeal against the denial of cenvat credit on certain input services - Air Travel, Tour Operator, Membership Fee of association and clubs.Analysis:The appellants, engaged in the manufacture of Machine Rolled Cigarettes and Cut Tobacco, filed appeals against the impugned order partially allowing cenvat credit on certain services. The Commissioner (Appeals) held the appellants eligible for cenvat credit on services like Commercial and Industrial Construction Services, Interior Decorators Services, and Outdoor Catering Services, but ineligible for services like Air Travel Agents Service, Tour Operator Service, and Membership of Club or Association Service. The Department issued show-cause notices alleging wrongful availment of Service Tax credit on certain services. The adjudicating authority demanded duty, interest, and penalty, which led to the present appeals.The appellants argued that the denial of cenvat credit on input services like Air Travel, Tour Operator, and Membership Fee of their association and clubs was incorrect and illegal, as these services are integral to their business. They cited various decisions of the Tribunal and Courts to support their claim. The learned counsel referred to cases such as CCE Vs. Fine Care Biosystems, Dr. Reddy s Lab Ltd. Vs. CCE, and others to establish that these services qualify as input services. The learned AR, on the other hand, reiterated the findings of the impugned order.After hearing both parties and considering the judgments cited, the Judicial Member held that the issue was conclusively in favor of the appellant based on the precedent set by the decisions referenced. Consequently, the appeals of the appellant were allowed by setting aside the impugned order, providing consequential relief, if any. The operative portion of the Order was pronounced in Open Court on 06/03/2017.