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2019 (6) TMI 568 - CESTAT MUMBAICENVAT Credit - input services - Demurrage Charges - HELD THAT:- These demurrage charges were charged during the course of providing services to the Appellant by the service provider. During the course of providing services to the appellant, sometimes the goods are retained at the airport beyond the free period and in such cases the airport would charge the service recipient i.e. the appellant, demurrage for the period for which the goods were stored in excess of the free period. It is not the case of revenue that no demurrage charges have been paid. Demurrage is part of handling of import and export shipments of the appellant and therefore the Cenvat credit of tax paid on such demurrage charges is available to the appellant. - credit allowed. CENVAT credit - Repair & Maintenance - rejection on the ground that Vehicle not owned by the appellant - HELD THAT:- Admittedly the appellant are not owner of those vehicles. It is rejected on the ground that no evidence has been produced to show that the onus to repair the hired vehicles is on the appellant. To keep the vehicle in good condition is very essential for providing the courier service by the Appellant because if the vehicles are in good conditions only then the appellant can provide the satisfactory and efficient services to its clients and therefore it has nexus with the output service. The Appellant has also paid the service tax charged on the invoice to the vendor and this has not been disputed - credit allowed. CENVAT credit - Reimbursement of expenses Such as mobile bills, telephone bills - rejection on the ground that Telephone not installed at appellant’s premises but of PAFEX and used by them - HELD THAT:- It can be said that the aforesaid services has been used for business activity of the appellant. These services are input service used for output service, in particular, when the Revenue could not establish with any evidence that the octroi/telephone/mobile has been used by the said M/s. Pafex for its personal use - credit allowed. CENVAT Credit - Reimbursement charges paid to M/s Jeena & Co. - denial on account of nexus - HELD THAT:- The customs clearance services provided by FedEx Express is directly connected with the courier services of import and export shipments provided by the Appellant, without which the Appellant cannot provide services to its customers, therefore undoubtedly the same is ‘input service’. Merely because the invoice of FedEx Express recorded that the charges are recovered as reimbursement charges of Jeena & Co., it does not take away the fact that it is essentially the consideration for the customs clearance services provided by FedEx Express through Jeena & Co. to the Appellant - credit allowed. Demand of Interest and penalty - HELD THAT:- Since the Cenvat Credit on the aforesaid services is allowed therefore there is no question of any interest or penalty. Appeal allowed - decided in favor of appellant.
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