Case Law Details
Commissioner of Central Excise Vs Oriental Insurance Company Ltd. (Delhi High court)
Delhi High Court held that the re-insurance services were not excluded from the definition of ‘input service’ as defined under Section 2(l) of the CENVAT Credit Rules, 2004 with effect from 01.04.2011.
Facts- The appellant has filed the appeal u/s. 35G of the Central Excise Act, 1944 read with Section 83 of the Finance Act, 1994 (the Act) impugning a final-order passed by the Customs, Excise & Service Tax Appellate Tribunal, New Delhi (CESTAT). By the impugned order, the learned CESTAT had held that the Oriental Insurance Company Ltd. (OIC) is entitled to avail Central Value Added Tax (CENVAT) credit on re-insurance services (Indian as well as Foreign Insurance).
According to the Revenue (appellant), the learned CESTAT’s conclusion is erroneous because by virtue of Rule 2(l) of the CENVAT Credit Rules, 2004 (CCR) as applicable during the period 01.04.2011 to 20.07.2012, CENVAT Credit was unavailable for insurance in respect of a motor vehicle.
Conclusion- In Shriram General Insurance Company Ltd. v. Commissioner of Central Excise, Jaipur-I it is held that a re-insurance service is not in respect of a motor vehicle, but is in respect of the assumed risks of an original insurer and thus, the aforesaid exclusion clause has no application to qualification of re-insurance services as “input service”.
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