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2018 (11) TMI 814 - CESTAT HYDERABAD100% EOU - CENVAT Credit - input services - product liability insurance - product recall liability insurance - place of removal - Department has denied the same on the ground that it is a post manufacturing activity and the liability arose only after goods were handed over to the buyers - Held that:- It can be seen that the risk covers the defects with the products. In such cases, when there are defects in the products, the appellant/manufacturer will have to recall the product and thereby incur huge financial loss. The insurance is for covering financial loss of the appellant/manufacturer and it cannot be considered as a post manufacturing activity. The finance or raising of capital or adjustment of finances by way of taking insurance etc., falls within the inclusive part of the definition. Tribunal in the case of New Foods Pvt Ltd Vs CCE & ST, Bangalore-II [2017 (1) TMI 151 - CESTAT BANGALORE] considered an identical issue and held in favor of the assessee holding that Cenvat Credit is eligible and refund claim was sanctioned. Appeal allowed - decided in favor of appellant.
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