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2019 (7) TMI 150 - AT - Central ExciseCENVAT Credit - input services - product liability insurance - post-sales/post-manufacturing service or not? - HELD THAT:- The product liability insurance is availed by the appellant for covering the risk of any manufacturing defect arising out of the finished products cleared by them. When the defects are found and put forward only after use of the vehicle by the purchaser of the vehicle, in such cases, the automobile manufacturer has to compensate / satisfy the claim of the customer which is thereafter reimbursed by the appellant. In such cases to cover the risk of such payment, appellant has to avail product liability insurance. Indeed, this insurance is directly connected with the manufacturing activity of the appellant and is also an input service used in relation to the manufacture of the finished products. The denial of credit is unjustified - appeal allowed - decided in favor of appellant.
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