GE T&D India Ltd. Vs Commissioner of GST and Central Excise (CESTAT Chennai)
CESTAT Chennai held that CENVAT credit on transport coordination services relating to employee movement is inadmissible for the period from 01.04.2011 onwards. Further, CENVAT on escort/security services may qualify as input services if the place of removal extends beyond the factory gate.
Facts- The Appellant is a manufacturer of electrical / transmission equipment. During audit of Accounts , the department noticed CENVAT credit taken on various services principally: (i) escort/security personnel deputed along with goods to customer sites; (ii) manpower for gardening; (iii) services of agencies for collection of C-Forms and payments; (iv) medical services for employees; (v) civil/works contract services (earth pits, manholes, STP, canteen/gas bunk renovation); (vi) servicing of canteen equipment / Sodexo meal pass booklets; (vii) transport-coordination services, etc.
Four Show Cause Notices were issued on the grounds of availment of ineligible CENVAT Credit. The period of dispute is April 2010 to March 2015. The Adjudicating Authority vide Order in Originals dated 30.10.2015 confirmed recovery of CENVAT credit with interest and imposed penalties. Commissioner (A) rejected the appeal of the assessee. Being aggrieved, the present appeal is filed.
Conclusion- Held that escort/security services are directly linked with safeguarding consignments during outward movement and may qualify as input services if the place of removal extends beyond the factory gate. However, since the relevant purchase orders, delivery terms, insurance/risk clauses and contractual documents have not been placed before us in sufficient detail, we are unable to conclusively determine admissibility. Accordingly, this issue is remanded to the adjudicating authority for the limited purpose of verifying the contractual place of removal and thereafter deciding eligibility of credit on escort/security services.
