2024 (12) TMI 221

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.... facts of the case, leading to this appeal, are summarised herein below: 2.2 The appellants are, inter alia, engaged in the manufacture of Servo Motor Gear Box assembly, Static Converters/inverters, Railway signaling group relays, etc. falling under Chapter 85. During the disputed period i.e., August 2016 to June 2017, the appellants had taken CENVAT credit of service tax paid on the input services received through their headquarters at Mumbai, being an Input Service Distributor (ISD) in terms of Rule 7 of the CENVAT Credit Rules, 2004 (for short, referred to as "CCR of 2004"). The department had conducted audit of the records of the appellants for the above disputed period and had objected to the taking of CENVAT credit in respect of the ....

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....led by the appellants. Feeling aggrieved with the impugned order, the appellants have filed this appeal before the Tribunal. 3. Heard both sides and perused the records of the case. I have also perused the additional written submission made in the form of paper book submitted in this case. 4.1 The issue for consideration before the Tribunal in this case relates to the following:- (i) utilisation of CENVAT credit taken on the input service viz., insurance services provided in respect of 'Mediclaim policy taken for parent of employees' by the appellants, is admissible as input credit under CENVAT Credit Rules, 2004 or not?. (ii) whether penalty is impossible on the appellants under Rule 15(1) of CENVAT Credit Rules, 2004 or not? 4.2 On....

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....r providing the said service ought to be treated as 'input service' and accordingly, the appellants are eligible to avail CENVAT credit paid on such input service in terms of Rule 2 (l)(ii) of the CCR of 2004. 5.1 On perusal of the case records, I find that the aforesaid issues have been already dealt in detail by the Coordinate Bench of the Tribunal and the present dispute is no more res integra, in view of the decision relied upon by the appellants in the cases of Ultra Tech Cement Limited Vs. Commissioner of Central Tax, Tirupati - 2020 (38) G.S.T.L.70 (Tri.-Hyd.). In this case and it has been held that the appellant is required to pay service tax as per the legal provision of Service Tax statute and is entitled to avail credit ....

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....ument of the appellant as far as these services are concerned. Merely because a person happens to be their employee he does not cease to be a service recipient. If the employees were not a service recipient, no amounts would have been recovered from them and no Service Tax would have been paid on the same. Conversely, the appellant cannot get any exemption from payment of Service Tax if he has rendered services, even if such services are rendered to their own employees for a consideration. This issue has been examined and clarified in the draft circular which never came to be issued. Nevertheless, the fact remains that there are two kinds of relationships between appellant and their employees. First, they have a relationship as an employer ....