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2015 (3) TMI 632 - HC - Service TaxBenefit of Cenvat credit - outdoor catering services and rent-a-cab services - Services provided in the factory for employees of the factory - According to the Department, outdoor catering services and rent-a-cab services could not be treated as 'input service' as defined under the Cenvat Credit Rules - whether the assessee can utilise the cenvat credit facilities in respect of outdoor catering services and rent-a-cab services, provided in the factory for its employees, as input service - Held that:- assessee carrying on the business of manufacturing cement by employing more than 250 workers is mandatorily required under the provisions of the Factories Act, 1948 to provide canteen facilities to the workers. Failure to do so entails penal consequences under the Factories Act, 1948. To comply with the above statutory provision, the assessee had engaged the services of a outdoor caterer. Thus, in the facts of the present case, use of the services of an outdoor caterer has nexus or integral connection with the business of manufacturing the final product namely, cement. Hence, in our opinion, the Tribunal was justified in following the Larger Bench decision of the Tribunal in the case of GTC Industries Ltd. (2008 (9) TMI 56 - CESTAT MUMBAI) and holding that the assessee is entitled to the credit of service tax paid on outdoor catering service. Definition of input service read as a whole makes it clear that the said definition not only covers services, which are used directly or indirectly in or in relation to the manufacture of final product, but also includes other services, which have direct nexus or which are integrally connected with the business of manufacturing the final product. In the facts of the present case, use of the outdoor catering services is integrally connected with the business of manufacturing cement and therefore, credit of service tax paid on outdoor catering services would be allowable. - The issue raised in respect of rent-a-cab services has been considered by the Karnataka High Court in the case of CCe V. Stanzen Toyetetsu India (P) Ltd. reported in [2011 (4) TMI 201 - KARNATAKA HIGH COURT] - Cenvat Credit has been properly availed in respect of outdoor catering services and rent-a-cab services - Decided against Revenue.
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