Tribunal allows credit on service tax for repairs during warranty

The Tribunal held that the credit on service tax paid on repairs and maintenance service of DG sets during the warranty period at customers' premises is admissible, following precedents. The appeal was allowed, emphasizing the eligibility of such credit based on established legal principles. The decision considered submissions from both parties and relevant records, setting aside the impugned order. The judgment underscores the significance of legal precedents in determining the admissibility of credit on service tax for repair and maintenance services provided outside the factory premises during the warranty period.

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Issues:
Admissibility of credit on service tax paid on repair and maintenance service of DG sets provided during the warranty period outside the factory premises.

Analysis:
The appeal was filed against an Order-in-Appeal passed by the Commissioner, CGST, & CE, Nagpur, regarding the availing of credit of service tax on repair and maintenance service of DG sets provided during the warranty period at customers' premises. The Revenue alleged that the service provided outside the factory premises was not eligible for credit, leading to a demand notice. The proceedings were initially dropped but were revived on appeal by the Revenue. The Revenue argued that the credit was denied without considering the relevant legal principles and earlier orders. The Appellant contended that the service tax paid on repairs and maintenance charges incurred at customers' premises during the warranty period should be eligible for credit. Reference was made to legal precedents, including judgments in similar cases. The Tribunal considered the issue of eligibility of CENVAT Credit on service tax paid for repair and maintenance service during the warranty period outside the factory premises in previous judgments and found it to be admissible.

The Tribunal, following the precedent set in earlier cases, held that the credit on service tax paid on repairs and maintenance service of DG sets during the warranty period at customers' premises is admissible. The impugned order was set aside, and the appeal was allowed. The judgment emphasized that the service provided during the warranty period outside the factory premises is eligible for credit based on legal principles established in previous cases. The decision was made after considering the submissions from both sides and reviewing the relevant records. The judgment highlights the importance of legal precedents in determining the admissibility of credit on service tax paid for repair and maintenance services provided outside the factory premises during the warranty period.

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