Tribunal Allows Cenvat Credit Appeal for Medi-Claim Insurance

The tribunal allowed the appeal regarding the eligibility of the appellant for cenvat credit of service tax paid on medi-claim insurance for employees. Citing settled decisions in favor of the assessee from various High Courts and Tribunals, the tribunal found no merit in the denial of credit. The appellant's contention was upheld, leading to the setting aside of the order denying the service tax credit on medical claims for employees. Additionally, the penalty imposed on the appellant was also set aside due to the absence of any malafide intent in the earlier non-payment of credit related to family members' medi-claim.

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Issues Involved: Eligibility of appellant for cenvat credit of service tax paid on medi-claim insurance for employees.

Analysis:
The judgment concerns the eligibility of the appellant for cenvat credit of service tax paid on medi-claim insurance for employees. The appellant contested the denial of credit related to medi-claim for employees while having already paid the service tax credit for medi-claim of family members. The appellant argued that similar issues had been settled in their favor by various decisions of High Courts and Tribunals, citing an appeal memorandum listing cases supporting their position.

The appellate tribunal, after hearing both sides and examining the appeal records, found that the issue was no longer res integra and had been settled in favor of the assessee in multiple decisions of Tribunals and High Courts. Specific references were made to decisions such as Kelly Services India Private Limited Vs. CCE, where eligibility for such credit was upheld. The tribunal also cited decisions from the Hon'ble Karnataka High Court and other tribunal decisions supporting the availability of service tax credit on health insurance services for employees.

Based on the cited decisions and the interpretation of entitlement to service tax credit on insurance for employees and family members, the tribunal found no merit in the impugned order. Consequently, the tribunal set aside the order with reference to the service tax credit on medical claims for employees. The appellant had already reversed the credit availed for family members with interest. The tribunal also noted that no malafide could be attributed to the appellant for the earlier non-payment of credit related to family members' medi-claim, leading to the setting aside of the penalty imposed. Therefore, the appeal was allowed to the extent of credit availability on medi-claim insurance for employees and the setting aside of the penalty.

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