2019 (1) TMI 1239

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....cleaning activities, Business Auxiliary Services, Erection and Commissioning and Transport of Goods by Road and have been providing the services at various oil refineries, fertilizer and other chemical industries. During the course of Audit on the appellant's record, it was noticed that the appellants have availed inadmissible credit of input services on hiring of vehicles and rent-a-cab amounting to Rs. 10,87,632/- (Rupees Ten Lakhs Eighty Seven Thousand Six Hundred and Thirty Two only). It was also noticed that in some instances there is a delay in issuing of invoices and hence an amount of Rs. 77,256/- (Rupees Seventy Seven Thousand Two Hundred and Fifty Six only) towards interest is to be paid in respect of delay in payment of ST. The a....

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.... Credit Rules 2004 and further the appellants have not produced any proof that the motor vehicles are registered in the name of service provider so as to classify as capital goods for them. He further submitted that the credit on renting of motor vehicle is availed as input service for the appellant as the exclusion under the definition of 'input service' on renting of motor vehicle is applicable only if the vehicle is not a capital goods for the service provider whereas in the present case vehicles are admittedly capital goods for the car rental service provider. He further submitted that this issue of liability of cenvat credit on rent-a-cab after the amendment to the definition of 'input service' from 2011 has also been considered by the....

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....rd, I find that the Tribunal in the case of Marvel Vinyls Ltd. cited supra has considered the issue after the amendment in the definition of 'input service' after 01.04.2011 and the Tribunal in this case has observed as under: "3. After hearing both the sides, I find that the definition of „input service‟ is contained in Rule 2(l) of the Cenvat Credit Rules, 2004 and relates to any service used by a manufacturer, whether directly or indirectly, in or in relation to manufacture of their final product and includes many services specified therein but excludes some of the services specified. An Exclusion Clause B was introduced w.e.f. 01.04.2011 to the following effect: "[(b) [Services provided by way of renting of a motor vehicl....

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....cle can never be a capital goods to the recipient of the said services. The motor vehicle will always be a capital goods or otherwise for the person who is providing the services. For service provider falling under the category of renting of motor vehicle the motor vehicle would always be a capital goods. As such the expression - "which is not a capital goods appearing in the said exclusion clause would require examination vis-à-vis the service provider and not vis-à-vis the services recipient." As such the interpretation of the lower authorities that motor vehicle are not capital goods for the service recipient cannot be appreciated inasmuch as motor vehicles are admittedly capital goods in terms of the Rule 2(A) of Cenvat Cr....