Cenvat credit on insurance services turns on vehicle status and employee-use findings before denial can stand.

Cenvat credit on insurance services linked to vehicles and employees depended on whether the vehicles qualified as capital goods and whether the insurance was used primarily for employees' personal use or consumption. During the material period, input service coverage excluded services relating to motor vehicles that were not capital goods and also excluded life and health insurance used for personal consumption. As the lower authorities had not recorded conclusive findings on these foundational facts and had relied on precedent without independently determining them, denial of credit could not be sustained. The matter was remanded to the original adjudicating authority for fresh findings and a de novo decision.

---

---

Issues: Whether Cenvat credit on insurance services relating to vehicles and employees was admissible in the absence of findings on whether the vehicles were capital goods and whether the insurance was used primarily for personal use or consumption of employees.

Analysis: The definition of input service during the material period excluded services relating to motor vehicles that were not capital goods and also excluded specified services, including life insurance and health insurance, when used primarily for personal use or consumption of employees. Admissibility of credit therefore depended on prior findings on the character of the vehicles and the nature of use of the insurance service. The lower authorities had not recorded conclusive findings on these foundational questions, and the impugned order relied on an earlier precedent without independently determining the relevant facts.

Conclusion: The denial of credit could not be sustained without those factual determinations. The matter was remanded to the original adjudicating authority for fresh findings and a de novo decision.

---