AI Drafter 
TaxTMI 
TaxTMI 
2018 (6) TMI 200
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....eriod, the appellants availed Cenvat credit of the service tax paid on repairs and maintenance of the vehicles by the 'Authorized Service Stations' (ASS in short), in respect of those vehicles which were insured by the appellant. The department took the view that such services do not form input services for the appellant in terms of the definition of input services as per Rule 2 (i) of the CCR, 2004. Accordingly, after issue of SCN, vide the impugned order the adjudicating authority confirmed the demand of an amount of Rs. 6,40,12,649/- along with interest and penalties under Sections 76 & 78 of the Finance Act, 1994. Aggrieved by the impugned order, the present appeal has been filed by the appellant. 2. In this connection we have heard ....
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....ble to the insurance companies as credit. By drawing analogy to the above circular, he stated that in the instant case the insurance company which has paid for the repairs to the ASS should be considered a the service receiver and will be entitled to the Cenvat credit of the service tax reimbursed by them. c. He drew our attention to the decision in the case of Paul Merchants Ltd. Vs. CCE, Chandigarh - 2013 (29) STR 257 (Tri.-Del.). He specifically referred to para 71 and submitted that the Tribunal in that case has made distinction between the recipient of service and beneficiary of the service. He submitted that the appellant was, by analogy having the status of the recipient of service in as much as he is obliged by the insuranc....
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....djudicating authority that the service receiver of ASS can only be owner of the vehicle and the appellant cannot be considered as deemed service receiver. Consequently, they will not be entitled to avail Cenvat credit. iv. He also drew our attention to para 18 & 22 of the impugned order and explained the view of Revenue that the documents based on which the appellant has availed the credit were not admissible documents in as much as they were all issued in favour of the vehicle owner and the appellant's name was never mentioned in such documents. 5. Heard both sides and perused the record. 6.1 The dispute is regarding the admissibility of Cenvat credit availed by the appellant on certain input services. Vehicle owners who hav....
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....t in dispute that the appellant has availed the credit only proportionately to the extent of amount borne by them. The general insurance service provided by the appellant basically insures the vehicle against damages. It is obvious that such service can be provided to the customer ie., owners of the vehicle only by way of reimbursement of the repair charges. We are unable to see any other way by which the vehicle insurance service can be delivered to the customer. In this scenario, we are of the view that the service tax paid on the bill of the ASS is to be considered as falling within the definition of the input service which is used for providing the output service of the vehicle insurance. 6.4 The appellant has relied on the decisi....
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....ies as credit." Even though the above clarification has been given in the context of health insurance services, we are of the view that the same is relevant for deciding the claim of the appellant for Cenvat credit. In the present case, the appellant being the service receiver will be entitled to the credit of service tax paid in terms of Rule 2 (l) ibid. 6.6 The Revenue has also raised the issue that the invoices issued by the ASS which is the document based on which the appellant has availed the Cenvat credit, is invariably in favour of the owner of the vehicle and is not in favour of the appellant. Hence, Cenvat credit cannot be allowed to the appellants. As discussed above, we have held that the above service is eligible to be con....