Tribunal remands cenvat credit denial on Catering Services due to employee count ambiguity.

The Tribunal set aside the denial of cenvat credit on Outdoor Catering Services, remanding the matter for reconsideration due to ambiguity regarding the number of employees at the appellant's establishment. The decision was influenced by a High Court ruling deeming such services as input services under specific conditions. The appellant's claim of employing over 300 workers, not previously raised, necessitated a fresh review by the original authority in line with the High Court's precedent. The appeal was allowed for remand, emphasizing a fair hearing for the appellants.

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Issues:
Appeal against denial of cenvat credit on Outdoor Catering Services.

Analysis:
The appeal before the Appellate Tribunal CESTAT, CHENNAI was regarding the denial of cenvat credit on Outdoor Catering Services, leading to a demand of Rs. 40,490 along with interest. The Commissioner (A) based the decision on a previous Tribunal case. The appellant argued that the issue aligns with a decision of the Hon'ble High Court of Bombay in a different case. The Departmental Representative mentioned that the previous Tribunal case is under appeal before the Hon'ble High Court of Madras.

Upon reviewing the submissions and records, the Tribunal noted the High Court of Bombay's decision in a similar case where outdoor catering services were considered an input service under the Factories Act if canteen facilities were mandated for factories with over 250 workers. However, in the current case, the number of employees at the appellant's establishment was not clearly stated. The appellant claimed to employ over 300 workers, which was not raised earlier due to a different focus of dispute.

Consequently, the Tribunal set aside the lower authorities' orders and remanded the matter to the original authority for reconsideration. The reconsideration was to be done in light of the High Court of Bombay's decision and considering the lack of clarity on the number of employees at the appellant's establishment. The Tribunal emphasized granting a reasonable opportunity of hearing to the appellants during the fresh consideration. The appeal was allowed for remand purposes.

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