Case Law Details
Zoloto Industries Vs Commissioner of Central Excise (CESTAT Chandigarh)
The case of Zoloto Industries Vs Commissioner of Central Excise before the Customs, Excise and Service Tax Appellate Tribunal (CESTAT) Chandigarh dealt with an interpretation of the scope of ‘Input Service’ as defined under Rule 2(l) of the Cenvat Credit Rules, 2004. CESTAT held that services such as Courier Agency, Exhibition, Insurance, and Internet fall under Input Service, thus qualifying for Cenvat credit.
Zoloto Industries, engaged in manufacturing valves and cocks, was denied Cenvat credit of service tax paid on various input services amounting to Rs. 57,597/- as per the order-in-original upheld by the Commissioner (Appeals). The authorities were of the view that these services did not fall under the purview of ‘Input Service’ as per Rule 2(l) of the Cenvat Credit Rules, 2004.
Upon appeal, the CESTAT examined numerous precedents provided by Zoloto Industries, which indicated that services of the nature under contention have been previously considered as input services. CESTAT, therefore, ruled in favor of the appellant, stating that the services in question were indeed input services and qualified for the Cenvat credit.
The CESTAT’s decision is a significant development in the interpretation of ‘Input Service’ under Rule 2(l) of the Cenvat Credit Rules, 2004. It emphasizes that a broad, inclusive interpretation should be applied that recognizes the diverse range of services utilized in the course of business operations.
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