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of <h1>CENVAT Credit Allowed for Statutory Obligations on Services</h1> <h3>M/s Nhava Sheva International Container Terminal Pvt. Ltd. Versus Commissioner of Central Excise, Raigad</h3> M/s Nhava Sheva International Container Terminal Pvt. Ltd. Versus Commissioner of Central Excise, Raigad - 2017 (3) G. S. T. L. 509 (Tri. - Mumbai) Issues:- Denial of CENVAT Credit on Outdoor Catering Services- Denial of CENVAT Credit on Manpower Supply for Garden Maintenance Services- Denial of CENVAT Credit on Maintenance and Repair Service of Sewage Treatment PlantAnalysis:Issue 1: Denial of CENVAT Credit on Outdoor Catering ServicesThe appellant contended that Outdoor Catering Services were provided as per statutory provisions and not for personal consumption. They agreed to reverse the credit for amounts recovered from employees pre-1.4.2011. Relying on the Ultratech Cements Ltd. case, the Tribunal allowed credit for the period pre-1.4.2011 where the service burden was borne by the appellant. Post-1.4.2011, credit was allowed as the services were statutory requirements, following the Hindustan Coca Cola Beverages case.Issue 2: Denial of CENVAT Credit on Manpower Supply for Garden Maintenance ServicesThe appellant argued that maintaining the garden was a statutory requirement under environmental regulations. They cited the Maharashtra Pollution & Control Board's conditions, emphasizing the necessity to operate the sewage treatment plant and use treated sewage for gardening. The Tribunal upheld the credit, stating that denial would conflict with statutory obligations.Issue 3: Denial of CENVAT Credit on Maintenance and Repair Service of Sewage Treatment PlantThe appellant justified the credit by highlighting the agreement with JNPT and compliance with pollution control regulations. They demonstrated the linkage between garden maintenance and sewage treatment as mandated by the Maharashtra Pollution & Control Board. The Tribunal ruled in favor of allowing the credit, considering it a statutory obligation for operating the Port.The Tribunal set aside the demands except for amounts recovered from others in the case of Outdoor Catering Services. Regarding interest liability, the rules were analyzed, and adjustments were recommended by the original adjudicating authority. Invocation of Section 80 was approved due to the interpretational nature of the issue, leading to the setting aside of penalties under relevant sections of the Finance Act, 1994. Ultimately, the appeals were partly allowed based on the aforementioned terms.
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