https://www.taxtmi.com/css/info/rss_sitemap/rss_feed.css?v=1746094055 https://www.taxtmi.com Business/Tax/Law/GST/India/Taxation/Policies/Legal/Corporate Tax/Personal Tax/Vat Law/Legal Information/Tax Information/Legal Services/Tax Services Tax Management India. Com / MS Knowledge Processing Pvt. Ltd. All rights reserved. One stop solution for Direct Taxes and Indirect Taxes https://www.taxtmi.com/caselaws?id=460569 https://www.taxtmi.com/caselaws?id=460569 CENVAT Credit - input service - service tax paid by an employer on insurance premiums for policies taken for employees and their family members. Insurance taken for employees - HELD THAT:- It would be appropriate to refer to the decision of the Bombay High Court in Coca Cola [ 2009 (8) TMI 50 - BOMBAY HIGH COURT] , wherein the definition of input service under rule 2(l) of the CENVAT Rules, as it stood prior to amendment made on 01.04.2011, came up for interpretation. The issue was as to whether the appellant, a manufacturer of non-alcoholic beverage bases, was eligible to avail credit of the service tax paid on advertising services, sales promotion, market research and the like services that had been availed. The High Court held that the expression means and includes is exhaustive and that the expression business is an integrated/continued activity and is not confined or restricted to mere manufacture of the product and, therefore, activities in relation to business can cover all activities that are related to the functioning of a business. The Bombay High Court in Ultratech Cement [ 2010 (10) TMI 13 - BOMBAY HIGH COURT] , after considering the earlier judgment of the Bombay High Court in Coca Cola, took the view that the definition of input service in rule 2(l) of the CENVAT Rules consists of three categories of services, and CENVAT credit of service tax paid on all such services would be available to an assessee. The judgment of the Supreme Court in Maruti Suzuki [ 2009 (8) TMI 14 - SUPREME COURT] would not come to the aid of the department to contend that unless there is a clear nexus between input service and manufacturing activity , CENVAT credit cannot be claimed. The appellant would be entitled to avail CENVAT credit of the service tax paid on procuring insurance policies for the employees. Insurance for family members of employees - HELD THAT:- It has been found as a fact in the present case that the appellant is entitled to avail CENVAT credit of the service tax paid on the insurance premium for the employees and their family members in terms of the definition of input service contained in rule 2(l) of the Credit Rules. The decision of the Tribunal in PTC Software [ 2014 (12) TMI 498 - CESTAT MUMBAI] correctly holds that CENVAT credit of the service tax paid for procuring insurance for the family members of the employees can be availed. The decisions to the contrary do not lay down the correct position in law. CENVAT credit of the service tax paid on the insurance premium paid for the family members of the employees would also be admissible. Conclusion - The appellant would be entitled to avail CENVAT credit of the service tax paid by the appellant on the insurance premium paid for procuring insurance services for the employees and their family members, as the said service would be an input service under rule 2(l) of the CENVAT Rules, both under the main limb of the definition as also under the inclusive limb of the definition. It is not necessary for the appellant to establish an integral connection between the service and business of manufacture for the said service to be categorized as input service under rule 2(l) of the CENVAT Rules for the period prior to 01.04.2011. The reference is answered, accordingly. The papers may be placed before the Division Bench of the Tribunal for hearing the appeal on merits. Case-Laws Service Tax Mon, 18 Mar 2024 00:00:00 +0530