Per : Ashok Jindal
The appellants have filed this appeal against the order of denial of Cenvat credit on the input services viz. Insurance on company vehicles, tours and travels, factory garden maintenance and plant housekeeping services.
2. Facts of the case are that the lower authority had denied Cenvat credit to the appellants on factory garden maintenance and plant housekeeping services observing that they are not related to in or in relation to the manufacture of final product and not falling under the definition of Input services and with regard to the insurance service and tours and travels they found that the appellant has failed to provide any records in respect of these service. Accordingly, credit was denied. Aggrieved by the same the appellant is before me.
3. Heard both sides.
4. Shri. J.H. Motwani, learned Advocate appearing for the appellant submitted that with regard to plant housekeeping service and garden maintenance service, their case is squarely covered by the decision of the Tribunal in the case of ISMT Ltd. vs. CCE and Cus., Aurangabad as reported in 2010 TIOL 27 (CESTAT-Mum.). Further in the case of Larsen and Toubro Ltd. vide order No. A/772/2009/SMB/C-IV dated 18.12.09, this Tribunal again held that garden maintenance service is eligible for availment of Cenvat credit. With regard to plant maintenance he relied on Sanghi Industries Ltd. vs. CCE, Rajkot - 2009 913) S.T.R. 167 (Tri. Ahmd) wherein it was held that Cenvat credit on maintenance of plant is admissible. With regard to other two services, he placed copy of invoices and details which were not placed before the lower authorities. He submitted that the lower authorities rejected the Cenvat credit on this service only because he failed to submit the documents, hence he submitted that with regard to these two services matter be remanded back to the adjudicating authority to examine the documents and allow credit.
5. On the other hand the learned SDR submitted that the appellant is not entitled for Cenvat credit on the garden maintenance service. He further submitted that in the case of I.S.M.T Ltd. (supra) this Tribunal has held that garden maintenance service is related to the business activity and holding that this Tribunal had allowed the Cenvat credit but in the case of Chemplast Sanmar Ltd. vs. CCE, Salem 2010 (250) ELT 46 (Tri. Chennai) this Tribunal has held that definition of input service as including activities relating to business, cannot be interpreted to include post-manufacturing activity and Section 37(2) of Central Excise Act, 1944 as enabling provision empowers government to make rules for providing credit of Service tax paid or payable on taxable services used in relation to manufacture of excisable goods. Hence, the appellants are not entitled to take the credit on the garden maintenance service. With regard to the plant housekeeping service, the ld. SDR submits that the reliance placed by the learned Advocate is not applicable in this case as in that case there was services of maintenance of plant but in this case the issue is regarding housekeeping of the plant. Hence the Cenvat credit has rightly been denied to the appellants.
6. On careful examination of the reliance placed by both parties I find as follows:-
(a) With regard to Insurance service and tour and travel service no documents were provided to the lower authorities. Therefore, I remand the matter back to the original adjudicating authority to examine the documents and if it is found that these documents confirm that the service tax paid is in relation to the vehicle used by the Company or its employees, then Service Tax credit be allowed.
(b) With regard to the garden maintenance service, I find that this Tribunal has held in the case of I.S.M.T Ltd. (supra) that a garden creates a better atmosphere and environment which increases the working efficiency of the factory. In that event, credit is entitled to the appellant. Further the reliance placed by the ld. SDR in the case of Chemplast Sanmar Ltd. (supra), has not considered in the order passed by the Hon’ble Bombay High Court in the case of Coca Cola and in the case of decision of I.S.M.T Ltd. has discussed the decision of the Hon’ble High Court of Bombay in the case of Coco Cola in detail and following the decision this Tribunal has held in the case of I.S.M.T Ltd. that the appellants are entitled to garden maintenance service. More over, in this case the credit is denied only holding that the same is not covered under the definition of Rule 2(l) of the CCR, 2004. Hence, I do not find any force in the arguments of ld. SDR. Accordingly, I allow the Cenvat credit on garden maintenance service.
(c) With regard to plant housekeeping service, the argument of ld. SDR is that the plant can run without housekeeping of the plant. In other terms without toilet and water facilities a plant can run. The argument of the SDR has no force, as providing the facilities of toilet and water are the basic requirement to run the factory and non-providing these facilities may affect the production, hence maintenance of house keeping service is essential and are related to the manufacturing activity.
7. In appellant’s own case the Jt. Commissioner vide Order No. 50/ST/JC/2008 dated 31.07.2008 has held that housekeeping charges for plant and plant office are entitled for input service credit.
8. From the above discussion, I am also of the view that no plant can run without proper maintenance of plant house keeping services. With these observations, I allow Cenvat credit on garden maintenance and plant housekeeping services.
9. With regard to insurance charge services and tours and travels services, I remand back the matter to the lower authorities to examine the issue as discussed above.