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M/s Sundaram Clayton Ltd. Versus CCE, Chennai - II

2016 (6) TMI 161 - CESTAT CHENNAI

Entitlement of Cenvat credit - input services - Rule 2(l) of the cenvat credit Rules, 2004 - Financial service - Held that:- this service is a covered service under Rule 2 (l) of CVR, 2004. Added to that finance being the necessary input for the purpose of carrying out the manufacturing activity and money is invested to carryout manufacture, credit cannot be denied for such services availed. - Clearing and Forwarding and Customs Clearing Services - Held that:- these services are integrally c .....

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clearance of the dumped goods having no utility is necessary to be removed in order to store raw materials or finished goods. Therefore, this service cannot be said to be not integrally connected and credit cannot be denied. - Legal services - Held that:- such services are availed for statutory compliance which is the duty of the assessee to comply and the credit cannot be denied for such services since it has relevancy to the activity of manufacture. Once there is legal obligation and the a .....

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this is an integral part of the business activity to reduce the paper work and to carryout business efficiently and effectively. Maintenance of software is also integral part of activity of business. Therefore, this service is inseparable from the business activity of the appellant for which appellant cannot be denied cenvat credit. - Photography service - Held that:- this service is used to issue ID cards to the employees and for other different business activity, which is used in relation .....

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- Travel booking service - Held that:- it is explained in the record that it is attributable to the transportation of the employees to different customer places and for business promotion activities. Therefore credit of service tax on this service cannot be denied. - Designing services - Held that:- such services pertained to the tools used in the manufacture of finished products, logos, graphics, corporate identity designing etc., This has nexus to the manufacture and clearance of goods .....

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ndispensable to carryout clearance of finished goods for which no cenvat credit on this count can be denied. - Business Auxiliary Service and Warehouse service - Held that:- BAS is explained to be relating to supply of labour service for manufacture and included in the definition of input service as per Rule 2(l) of CCR, 2004, which is relevant to the manufacturing activity and therefore, appellant cannot be denied credit thereon. So far as the warehouse service is concerned, that related to .....

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tled to cenvat credit on all the services. - Decided in favour of appellant - E/485-487/2012 & E/41529/2014 - Final Order Nos. 40066-40068 and 40070/2016 - Dated:- 8-1-2016 - D. N. Panda, Member (J) And R. Periasami, Member (T) For the Appellant : Mr. G. Viswanathan, GM (Legal) For the Respondent : Mr. K.P. Muralidharan, AC (AR) ORDER Order Per D. N. Panda On behalf of the appellant Shri G. Viswanathan, GM (Legal) submits that all the three appeals No. E/485 - 487/2012 covers three Show Cause .....

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,03,623.64 11,24,230.16 5,16,474.96 2,575.00 3,55,180.27 29,301.72 2,68,186.79 6,730.39 1,32,173.82 52,243.19 Total 38,90,719.94 2 07/2012 dt.8.5.2012 Period 01.02.2011 to 31.03.2011 Auction Services Banking and other financial services CHA services Design Services Information Technology Services Photography Services Rent a cab Service Rent paid for temporary structure Travel Booking Service 2,99,646.00 8,52,702.00 9,00,877.00 12,0310.00 7,25,940.00 3,216.00 1,47,305.00 87,401.00 48,327.00 Total .....

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he table above are pertaining to the manufacturing activity and the respective services were input for the said activity for which that was utilised. Explaining each item listed in the table above, he submits that; • Banking and other financial services are nothing but financial services which is covered by Rule 2 (l) of Cenvat Credit Rules, 2004. Therefore, where there was a clear evidence of the provisions of financial services provided by Banks and other financial institutions, this aspe .....

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her capital assets of the Company. • Auction Services are availed to clear the scrap of the factory, which is indispensable to get manufacturing place and place for storing finished goods. • Courier service is very much necessary for the business related activities, which was availed by the appellant. • Information Technology Service is the service relating to the technological assistance availed for running of the business • Photography service was utilised to provide ID car .....

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ctory building. • Legal services availed relate to the charges paid by the company to the counsels for the services availed in legal matters relating to the appellant. • CHA services were used for import as well as export of goods, which is indispensible for the clearance of the finished goods. • Rent paid for temporary structure service was availed for the purpose of building a temporary structure to store the finished goods as well as raw materials. 3. So far as the appeal No. E .....

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the warehouse service is concerned, it is necessary for the business concern to avail this service for storing finished goods before clearance or to bring the raw materials for clearance. 4. Revenue supports adjudication. Ld. DR relies on the Tribunal's decision in the case of the appellant reported in 2012 (25) STR 172 (Tri.-Chen.) as well as in the Tribunal's Final Order No. 1297/2011 dated 131.12.11, which has not yet been reported. In the unreported decision the matter was remanded f .....

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ce of the factory shall remain dumped with the unwanted goods, for which the clearance is necessary in order to facilitate storage of goods both finished and raw materials. 5. Heard both sides and perused the records. So far as the three appeals No. E/485 - 487/2012 is concerned, we have examined each item that was brought to our notice from the Table at para-11 of the adjudication order dated 31.08.2012. • We appreciate that the financial service is a covered service under Rule 2 (l) of CV .....

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protects the raw materials and finished goods in transit as well as the assets of the company, for which credit cannot be denied for availing this service. • Auction service is also integral part of the manufacturing activity since, clearance of the dumped goods having no utility is necessary to be removed in order to store raw materials or finished goods. Therefore, this service cannot be said to be not integrally connected and credit cannot be denied. • Legal services are availed fo .....

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ibility of movement of documents as well as goods with least cost. Therefore, the appellant is entitled to cenvat credit on this count. • Information Technology service is an integral part of the business activity to reduce the paper work and to carryout business efficiently and effectively. Maintenance of software is also integral part of activity of business. Therefore, this service is inseparable from the business activity of the appellant for which appellant cannot be denied cenvat cred .....

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ed since rent a cab service is essential for the movement of the employees to factory and to carry out business activity. • Travel booking service is explained in the record that it is attributable to the transportation of the employees to different customer places and for business promotion activities. Therefore credit of service tax on this service cannot be denied. • Designing services pertained to the tools used in the manufacture of finished products, logos, graphics, corporate id .....

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