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of <h1>Partial Success in Cenvat Credit Appeal: Repair Services Allowed, Rent-a-Cab Limited</h1> <h3>Aurangabad Electricals Ltd. Versus Commissioner of Central Excise, Pune-II</h3> The appellant was partially successful in their appeal regarding entitlement to Cenvat credit. The Tribunal allowed the credit for repair and maintenance ... CENVAT credit - whether appellant is entitle for the Cenvat credit in respect of civil works i.e. repair and maintenance of road and drainage system within the factory premises, rent-a-cab service provided prior to 1-04-2011 and after 1-4-2011, loan processing fees for funds obtained for capital requirement? Repair and maintenance of road and drainage system - Held that: - the civil work service which is related to repair and maintenance of road and drainage system as renovation, modernisation and repairs at factory premises is included in the inclusion category and of the definition of input service therefore credit is admissible on such service - credit allowed. Rent-a-cab service - Held that: - the said service is used in or in relation to overall manufacturing activity of the appellant therefore credit is admissible only upto 31-03-2011 - however from 1-4-2011 rent a-cab service is excluded from the definition of the input service therefore credit for the period after 1-4-2011 is not admissible - credit upto 31-03-2011 allowed. Service of processing of loan - Held that: - financing is most important part of any business organisation without which no business can take off therefore credit in respect of service tax paid on loan processing fees is clearly admissible - credit allowed. Appeal allowed in part. Issues Involved:Whether appellant is entitled to Cenvat credit for civil works, rent-a-cab service, and loan processing fees.Analysis:1. Civil Works (Repair and Maintenance):The appellant argued that repair and maintenance of roads and drainage within the factory premises qualify as an admissible input service. They cited judgments to support their claim, emphasizing that the exclusion under Cenvat credit rules on 1-4-2011 does not apply to repair and maintenance activities. The Tribunal agreed, noting that such services fall under the inclusion category of input services, making the credit admissible.2. Rent-a-Cab Service:The appellant contended that the rent-a-cab service was used for official purposes to transport executive and staff, making it an admissible input service. However, they acknowledged that post-1-4-2011, this service was excluded from the definition of input service. The appellant reversed the credit for the period after 1-4-2011. The Tribunal concurred, allowing the credit for the period before 1-4-2011 but denying it for the subsequent period.3. Loan Processing Fees:Regarding loan processing fees, the appellant argued that funding activities are vital for business operations, making the service tax on such fees admissible for credit. The Tribunal agreed, stating that financing is crucial for any business to function, thus allowing the Cenvat credit for this service.4. Limitation and Penalties:The Tribunal did not address the issue of limitation as the Cenvat credit was allowed on merit. Considering the circumstances, penalties were set aside. The appeal was partly allowed based on the above analysis.
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