TaxTMI Login
Just a moment...
Press 'Enter' to add multiple search terms. Rules for Better Search
When case Id is present, search is done only for this
of 
of 
No Folders have been created
Are you sure you want to delete "My most important" ?
NOTE:
of of 
All Case Laws
of of All Case Laws
Note
Bookmark
Share
Don't have an account? Register Here
of <h1>Court upholds CENVAT credit for insurance services benefiting cement manufacturer</h1> <h3>COMMISSIONER OF CENTRAL EXCISE, TIRUNELVELI Versus M/s THE INDIA CEMENTS LTD</h3> COMMISSIONER OF CENTRAL EXCISE, TIRUNELVELI Versus M/s THE INDIA CEMENTS LTD - 2014 (313) E.L.T. 714 (Tri. - Chennai), 2017 (49) S.T.R. 603 (Tri. - ... Issues:- Interpretation of CENVAT Credit Rules, 2004 regarding insurance services as input services for cement manufacturers.Analysis:The case involved an appeal by the department against the Commissioner (Appeals) order regarding the denial of CENVAT credit on insurance services availed by a cement manufacturer. The manufacturer had taken insurance to protect against business interruptions due to various perils like fire, riot, and terrorist attacks. The original authority denied the credit, but the Commissioner (Appeals) overturned this decision. The department argued that the insurance did not have a direct nexus with manufacturing and sale activities. They cited precedents before the Tribunal and High Court where similar issues were challenged. The manufacturer, on the other hand, supported the Commissioner's decision, emphasizing the terms of the insurance policy.Upon careful consideration, the judge referred to Rule 2(l) of the CENVAT Credit Rules, 2004, which defines 'input service.' The rule includes services related to setting up, modernization, renovation, or repairs of a factory, among others. The judge noted that insuring plant and machinery against potential disruptions and loss of profit due to business stoppages from perils like fire and riots is a precautionary measure for safeguarding the business financially. The judge agreed with the Commissioner (Appeals) that the insurance policy covering loss of profit during production stoppages due to machinery damages falls under 'activities relating to business' as per the definition of input services.Ultimately, the judge found no valid reasons to interfere with the Commissioner (Appeals) order and rejected the department's appeal. The cross objection supporting the Commissioner's decision was also disposed of accordingly.
TaxTMI 