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2021 (8) TMI 1366 - AT - Central ExciseCENVAT Credit - input services - Contingent Liability Insurance/Public Product Liability Insurance - Marine Insurance Policy - period from August, 2014 to June, 2016 - HELD THAT:- There are insurance policies which cover the risk on different aspects for manufacturer as well as service provider. Such indemnification is necessary to meet the risk and liability that may arise on the happening of a contingency mentioned in the policy. In the case of an injury caused by the use of product to the public, the appellant is liable to compensate such mishappening. The policy would help the appellant to meet such liability. In case, there is no such insurance policy, the appellant will have to face huge financial loss, which will affect the business of manufacture. Such policies are also required in the interest of the public to safeguard injuries that may occur due to consumption of products manufactured by the appellant - the credit availed on the service tax paid on Contingent Liability Insurance is eligible. Marine Insurance Policy - only ground alleged for denying the credit is that there is no nexus between the input services and the manufacturing activity - HELD THAT:- The refund under Rule 5 can be claimed on the input services used for exports made under a particular quarter. In the present case, the period covered by the Marine Insurance Policy is from 1-7-2016 to 30-6-2017. The policy covers the risk of goods under transit for a period of one year. Usually carrier may hold a transit policy, which covers each consignment. The Marine Insurance Policy in the present case intends to indemnify the risk of the goods under transit belonging to the appellant. The discussion made by the Commissioner (Appeals) for denying the credit on this input service, is legally misplaced - the credit on Marine Policy is eligible. Thus, the disallowance of credit on Contingent Liability Insurance and Marine Insurance Policy cannot sustain. The impugned order to this extend is set aside - appeal allowed.
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