2018 (11) TMI 1526

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....see during the period 2008-09 to 2010-11 are admissible. So far as Cenvat Credit on "Rent-a-Cab Service" is concerned, that has been accepted by the Revenue and therefore the instant Appeal is confined only to the admissibility of Cenvat Credit on "Medical Insurance Service". The impugned order has been challenged by the Revenue on the following grounds:- "(i) That the Appellate Authority, vide the subject Order-in- Appeal dated 23.01.2018, had mainly relied upon the judgment of the Hon'ble High Court of Karnataka in the case of CCE, Bangalore-II versus Stanzen Toyotestsu India Pvt. Ltd. - reported in 2011(23) STR 444 (Kar.), also in the decision of the Hon'ble CESTAT in the case of Axis Bank Ltd versus Commissioner of Service Tax, Mumbai ....

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....to business and that there is direct nexus between the said expenditure and the business of the Appellant's firm and that there is no dispute regarding the input service credit document and the payment of service tax. 3. The disputed period with regard to the denial of Cenvat credit on medical insurance services is prior to 1-4-2011 when the definition of input services included 'activities relating to business'. The definition of input services as per Rule 2(l) of the Cenvat Credit Rules, 2004 is as under :- "input service" means any service, - (i) used by a provider of taxable service for providing an output service; or (ii) used by the manufacturer, whether directly or indirectly, in or in relation to the manufacture of final product....

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....ging proper medical attendance for sick workman or other employees of the company. Therefore, the medical insurance in relation to the employees of the company are also within the broad definition of input service given at Rule 2(l) of the Cenvat Credit Rules, 2004. 4. The Hon'ble Karnataka High Court in the matter of CCE v. Micro Labs Ltd.; 2011 (270) E.L.T. 156 (Kar.) has held that Service Tax paid on group insurance and health insurance policy for employees is an input service on which credit can be allowed. There is another similar decision by the Hon'ble Karnataka High Court in the matter of CCE v. Stanzen Toyotetsu India (P) Ltd.- 2011(23)S.T.R.444(Kar.). which has been relied upon by the ld. Commissioner while passing the impugned o....

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....pecifically included in the input service definition. 15. Therefore, merely because these services are not expressly mentioned in the definition of input service it cannot be said that they do not constitute input service and the assessee is not entitled to the benefit of CENVAT credit. In fact, Rule 3 of the Cenvat [Credit] Rules, 2004, specifically provides that the manufacturer of final products shall be allowed to take credit, the service tax leviable under Section 66 of the Finance Act and paid on any input service received by the manufacturer of a final product. Therefore under the scheme of the Cenvat Credit Rules, 2004, the service tax paid on all those services which the assessee has utilized directly or indirectly in or in relati....

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....e availed by the assessee in the course of their business, hence denial of input service on these two above services is not sustainable. The impugned order denying the input service credit on local travel and medical insurance and on input service availed on April 2006 is set aside and the appeals of assessee are allowed with consequential relief." 7. In a recent decision, the Tribunal in the matter of Deloitte Support Services India Pvt. Ld. Vs. CCE, Hyderabad-IV; 2017(5)GSTL 393(Tri-Bang.), while following the decision of the Hon'ble Karnataka High Court in the matter of Stanzen Toyotetsu India (P) Ltd. (supra), has held as under:- "Cenvat credit availed amount to Rs. 1,42,98,722/- during the period from 2006-07 to 2010 to 2011 has been....

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.... requirement of pre-deposit and take up the appeal itself for finalization. 3. In view of the discussions above, since the issue is no longer res integra, the appeal itself will have to be allowed and we do the same with consequential relief if any to the appellants." 8. The aforesaid decision of the Tribunal was challenged by the Revenue before the Hon'ble Andhra Pradesh High Court and the Hon'ble High Court vide order dated 1.4.2014 in the matter of Commissioner vs. Deloitte Support Services India Ltd.; 2017(5) GSTL J197 (A.P.) dismissed the Appeal filed by the Revenue. 9. So far as the ground taken by the revenue that in the matter of Axis Bank Ltd. vs. CST; 2017 (3) GSTL 427 (Tri-Mum), wherein the issue involved is on similar lines, ....