2018 (11) TMI 1447 - AT - Central Excise

Appellant wins CENVAT Credit for Manpower services. Importance of premises maintenance highlighted. Order-in-Original set aside.

The judgment ruled in favor of the appellant, upholding the eligibility of CENVAT Credit for services of Manpower for Gardening, Housekeeping, and ... CENVAT credit - input services - availability of credit for housekeeping and landscaping services - nexus with manufacture of excisable goods - eligibility of security personnel services deputed with goods as input service - following binding ratio of jurisdictional High Court precedentsCENVAT credit - input services - availability of credit for housekeeping and landscaping services - following binding ratio of jurisdictional High Court precedents - Supply of manpower for gardening and housekeeping qualifies as eligible input services and CENVAT credit is allowable. - HELD THAT: - The Tribunal examined the jurisdictional High Court decision relied upon by the assessee (Wipro Ltd. ) which, following earlier precedents, held that services of housekeeping and landscaping fall within the wide and inclusive definition of 'input services' and that tax on such services forms part of the cost of final products. The Tribunal found the facts in the present case-housekeeping and gardening services availed within factory premises-to be squarely covered by that ratio and applied the same reasoning to allow CENVAT credit in respect of these services.Allowed in favour of the appellant; CENVAT credit for manpower supply for gardening and housekeeping upheld.CENVAT credit - input services - eligibility of security personnel services deputed with goods as input service - nexus with manufacture of excisable goods - Services of security personnel deputed along with goods to customer sites qualify as eligible input services and CENVAT credit is allowable. - HELD THAT: - The Tribunal accepted the appellant's contention that engaging security personnel to accompany high value goods during delivery was essential to the appellant's business and integral to timely and safe supply. By parity of reasoning with the allowance of credit for security services engaged for overall business premises and with the logic applied to housekeeping/landscaping, the Tribunal concluded that the same personnel engaged for services related to business operations and safe delivery have sufficient nexus with manufacture/supply to qualify as input services and permit credit.Impugned order set aside; CENVAT credit for security personnel deputed with goods allowed in favour of the appellant.Final Conclusion: The appeal is allowed; the demands, interest and penalty confirmed by lower authorities are set aside to the extent they denied CENVAT credit for manpower supplied for gardening, housekeeping and for security personnel deputed with goods, with consequential benefits as per law. Issues involved:1. Eligibility of CENVAT Credit on services availed by the appellants.2. Supply of Security Personnel and its nexus with the manufacture of excisable goods.Analysis:Issue 1: The appellants availed CENVAT Credit for services of Security Personnel and Manpower for Gardening and Housekeeping. A Show Cause Notice was issued proposing a demand under Rule 14 of the CENVAT Credit Rules, 2004. The lower adjudicating authority confirmed the demand, interest, and imposed a penalty. The Commissioner of G.S.T. & Central Excise rejected the appeal. The appellant appealed to the forum. The Advocate cited a High Court judgment holding services as eligible input services. The AR supported the lower authorities. The Member analyzed the High Court judgment and found it applicable to the present case. The judgment emphasized the broad definition of input services and the relevance of maintaining factory premises. The Member ruled in favor of the appellant for both Manpower for Gardening and Housekeeping services.Issue 2: The Member considered the argument regarding the Supply of Security Personnel essential for timely delivery of high-value goods. Drawing parallels with the eligibility of Manpower for Gardening and Housekeeping, the Member concluded that Security Personnel engaged in ensuring safe delivery should also be considered eligible. The Member found the impugned Order unsustainable and set it aside, allowing the appeal with consequential benefits.In conclusion, the judgment upheld the eligibility of CENVAT Credit for services of Manpower for Gardening, Housekeeping, and Security Personnel, emphasizing the importance of maintaining factory premises and ensuring safe delivery of goods. The Order-in-Original was set aside, and the appeal was allowed with consequential benefits.