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2016 (3) TMI 124 - AT - Service TaxEligibility for cenvat credit of the service tax paid on the services received from sub-contractors - treatment as “input service” for the output service of repair and maintenance under AMC - Held that:- There is no dispute that the appellant during the period of dispute were paying service tax on their output service on repair and maintenance under AMC Contract. In our view, the service received by the Appellant from these sub-contractors (Business Auxiliary Service) is to be treated as “input service” for the output service of repair and maintenance under AMC and the ground on which the Commissioner has denied the service tax in respect of these services is totally wrong. In view of this, the cenvat credit demand is not sustainable and has to be set aside. - Decided in favour of assessee Cenvat credit demand in respect of the service tax paid by the commission agents on the service of procuring sales orders provided to the Appellants - Held that:- We are of the view that this service is nothing but sales promotion service which is specifically mentioned in the definition of “input service” . This issue has been discussed at length in its judgement in the case of Ambika Overseas (2011 (7) TMI 980 - PUNJAB & HARYANA HIGH COUR) and Birla Corporation (2014 (6) TMI 385 - CESTAT NEW DELHI), wherein it has been held that this service is covered by the definition “input service” and would be eligible for cenvat credit. In view of this, the cenvat credit demand is also not sustainable. - Decided in favour of assessee Cenvat credit demand is in respect of the service received from the dealers who had provided repair and maintenance service during warranty period on behalf of the appellant to the customers - Held that:- The sale price of the air conditioners sold by the appellant to their consumers during the period of dispute included the warranty charges. There is no dispute that central excise duty had been paid on the value which included the warranty charges. During the warranty period, the appellant were under obligation to provide free repair and maintenance services to the consumers, who had purchased the air conditioners from them. However, instead of providing the free repair and maintenance service directly in discharge of their obligation, the appellant roped in the dealers who provided free repair and maintenance to the consumers on their behalf and the dealers for providing this service on behalf of the appellant, received the payment from the appellant and on that amount, they paid the service tax. The point of dispute is as to whether the service provided by the dealers to the Appellant is an input service and whether the appellant would be eligible for cenvat credit in respect of the same. The service received by the Appellants from their dealers is Business Auxiliary Service which has to be treated as an input service for the Appellant used in or in relation to manufacture of their final products, as free warranty repair and maintenance during warranty period, has enriched the value of the goods. See Danke Products (2009 (7) TMI 137 - CESTAT, AHMEDABAD ) - This issue stands decided in favour of the appellant assessee
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