Keyman Insurance premium qualifies as input service for Cenvat credit when the company is the policy beneficiary.

Cenvat credit on premium paid for a Keyman Insurance Policy was held admissible where the company was the beneficiary under the policy. The Tribunal treated the issue as covered by its earlier decision in the assessee's own case and applied Rule 2(l) of the Cenvat Credit Rules, 2004 to treat the premium as an input service. On that basis, the demand, interest and penalty were set aside.

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Issues: Whether Cenvat credit was admissible on the premium paid for Keyman Insurance Policy taken for the Managing Director and whether the demand, interest and penalty were sustainable.

Analysis: The issue was treated as identical to an earlier decision in the appellant's own case, where it was held that the policy documents showed the company as the beneficiary and that premium paid for Keyman Insurance constituted input service for the purpose of Cenvat credit under Rule 2(l) of the Cenvat Credit Rules, 2004. On that footing, the confirmation of demand and the consequential levy of interest and penalty could not survive.

Conclusion: Cenvat credit on the Keyman Insurance premium was held admissible and the demand, interest and penalty were set aside in favour of the assessee.

Ratio Decidendi: Premium paid for Keyman Insurance, where the company is the beneficiary under the policy, qualifies as input service for Cenvat credit purposes.

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