TaxTMI 
TaxTMI 
2017 (10) TMI 456
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....ejected by the original adjudicating authority was in relation to the professional indemnity insurance service. Aggrieved from the order of the adjudicating authority, the appellant filed an appeal before the Commissioner (Appeals). The first appellate authority allowed the claim of the assessee, aggrieved from which, the Revenue has filed this appeal. 2. Learned AR for the Revenue submits that the definition of input service has been revised after 1.4.2011 and the definition does not have word "the activity relating to business". It was contended that in order to qualify as input service either the service should be used for providing an output service or same should be used in relation to the activity mentioned in Rule 2(l) (ii) of Cen....
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....2017 in Appeal No.ST/60330/2017] 4. Heard the parties and examined the records. 5. I find that the main contention of the Revenue is that after amendment of the definition of input service from 1.4.2011, the word the activity relating to business has been deleted from the definition of input service and the impugned service cannot be said to be directly used for providing any output service. It is also argued that the impugned service is not covered by the inclusive part of the definition and it is used only when output service is complete and delivered. 6. On the question as to whether the professional indemnity insurance service has nexus with output service, I completely agree with the analysis of the Commissioner (Appeals) in t....
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....rovision of one or more of the specified services; or (B) specified in sub-clauses (d), (o), (zo) and (zzzzj) of clause (105) of section 65 of the Finance Act, in so far as they relate to a motor vehicle except when used for the provision of taxable series for which the credit on motor vehicle is available as capital goods; or (C) such as those provided in relation to outdoor catering, beauty treatment, health services, cosmetic and plastic surgery, membership of a club, health and fitness centre, life insurance, health insurance and travel benefits excluded to employees on vacation such as leave or home travel concession, when such services are used primarily for personal use or consumption of any employee", Definition of Input se....
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....ces, where the assessee has to safeguard itself against unforeseen legal damages/costs due to negligence or other bonafide mistakes of the employees/partners. Hence, the professional indemnity insurance service is an essential ingredient for providing the output service and has direct nexus with the providing of output service. 8. From the perusal of the insurance cover placed on record by the respondent, I find that the cover is not for a particular employee but is a general insurance cover taken by the assessee for the firm and any partner, member or employee to indemnify against legal liability for damages, defence costs etc. As the insurance cover is not meant for personal use or private consumption of any employee, it does not fall ....