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2023 (8) TMI 788 - AT - Central ExciseCENVAT Credit - input services - service fees paid to principals namely Honda Motor Company Ltd., Japan for development of Part Manual and Service Manual - reverse charge mechanism. HELD THAT:- Part Catalogue is nothing but a part of the inventory management system for the appellant in respect of the parts procured and supplied by them through their dealers to the ultimate customers. It is a well established fact that every automobile - four wheeler vehicle comprises of hundreds of small parts which need to be identified for the effective and comprehensive repair and maintenance of the vehicle. Part catalogue is the document created for codification of all the parts for proper understanding and management of inventory. This codification is used not only for inventory management but also for placing the orders on the suppliers and receiving the orders from the dealers/customers. Even the storage bins are to be identified as per these part catalogue - this part catalogue is essentially the part inventory management, procurement and supply system of the parts to the dealers and through them to the ultimate customers. The maintenance repairs and construction manual, is like an idiot guide to the dealers for undertaking the work of repairs and maintenance of the vehicles ensuring compliance with the high safety standards set by Honda Motors, by use of the genuine parts supplied by the appellant. It provides how to further maintain and repair the vehicles brought to the dealers by their customers. Such standardization is absolutely essential to ensure that standard set by the manufacturer are achieved irrespective of the person or the dealer servicing the vehicle. This standardization will promote the sale of genuine parts which are supplied or sold by the appellants. Thus this manual is essential to the activities undertaken by the appellant through supply of genuine spare parts. The denial of CENVAT credit in respect of services of development of “Part Catalogue” and “Maintenance, Repair and Construction Manual” cannot be upheld. Since it is held that the credit is admissible to the appellant we are not recording any separate finding on the issue of limitation, interest and penalties imposed. As no demand survives the demand for interest and penalties imposed also are set aside. There are no merits in the impugned order - appeal allowed.
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