2009 (8) TMI 736 - AT - Service Tax

Appellate Tribunal rules insurance on business vehicles as input service, waives pre-deposit, stays recovery

The Appellate Tribunal CESTAT, New Delhi found that insurance on vehicles used for business activity can be considered an input service. Consequently, the ... Waiver of pre-deposit – Service tax paid on insurance charges on cars – assessee contended that cars are used in relation to business activity - and that insurance is a necessity before use of the cars – Held that: - applicants have a case for waiver of the dues as per the impugned order as insurance on vehicle used for business activity can be considered as input service - pre-deposit waived - disposal of the appeal accordingly The Appellate Tribunal CESTAT, New Delhi heard a stay petition regarding the admissibility of service tax paid on insurance charges by a manufacturer of excisable goods for cars used by their executives. The Tribunal found that insurance on vehicles used for business activity can be considered as an input service. As a result, the Tribunal waived the pre-deposit of dues and stayed the recovery until the appeal is disposed of.