Case Law Details
Bhavani Industries Vs C.C.E. & S.T. (CESTAT Ahmedabad)
Issue lie in narrow compass that whether the appellant is eligible to Cenvat Credit in respect of Service Tax paid by Product Recall Insurance Policy. As per the facts of the case the Product Recall Insurance Policy is taken by the appellant, as per condition of sale of the goods, without the said condition the goods cannot be sold to customer, the Product Recall Policy is pre-decided before supply of the goods. Therefore, it cannot be said that the Product Recall Policy Expenses is a post removal expenses, once it is pre-determined the goods can be supplied only after the Product Recall Policy is taken then it becomes part of cost of the final product, during the manufacturing of the same.
In the present case the Product Recall Policy expenses is born for the purpose of security of the goods. Therefore, for his reason also the service falls under the definition of input services AND Service Tax paid in respect of product recall policy for sale of the finished goods is eligible for Cenvat Credit.
FULL TEXT OF THE ORDER OF CESTAT AHMEDABAD
Shri. Rahul Gajera, Learned counsel appearing on behalf of appellant submits that the issue involved is the Cenvat Credit in respect of Product Liability and Product recall insurance policy. He submits that this is a periodical case, in the earlier period this tribunal has already decided the matter in favor of the appellant in the case reported as M/s. Bhavani Industries V/s. C.C.E. & S.T. Rajkot 2018 (10) TMI 626 CESTAT AHMEDABAD.
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