Hero Honda Motors Ltd Vs Commissioner of Central Excise (CESTAT Chandigarh)
Cenvat Credit on Manpower Supply for Canteen Allowed Because Canteen Facility Is Mandatory Under Factories Act; CESTAT Sets Aside Cenvat Credit Demand Because Definition of Input Service Has Wide Scope; Revenue’s Challenge to Canteen Service Credit Rejected Because Statutory Canteen Is Part of Production Cost; CESTAT Grants Relief on Multiple Input Services Because Prior Decisions Already Allowed Similar Credits.
The case involved eight appeals arising from a common order dated 30 July 2013 passed by the Commissioner of Central Excise, Delhi-III, Gurgaon. Seven appeals were filed by the assessee and one appeal was filed by the Revenue. The Commissioner had confirmed a demand of ₹3,87,87,373 along with equal penalty and applicable interest on alleged wrongful availment of Cenvat credit, while dropping the demand of ₹59,57,187 relating to “Manpower Supply for Canteen Service.”
The assessee, engaged in the manufacture and clearance of two-wheelers and spare parts, had availed Cenvat credit on inputs, input services, and capital goods under the Cenvat Credit Rules, 2004. The department issued seven show cause notices covering the period from 1 April 2004 to 31 March 2012, alleging that credit had been taken on ineligible input services not used directly or indirectly in relation to manufacture.
