CESTAT, BANGALORE BENCH
EMCON Technologies India (P.) Ltd.
Commissioner of Central Excise
FINAL ORDER NO. 716 of 2012
APPEAL NO. E/1310 of 2010
NOVEMBER 16, 2012
1. In this appeal filed by the assessee, the short question arising for consideration is whether, on ‘rent-a-cab service’ and ‘air travel agents service’, the appellants rightly availed CENVAT credit or not. It is the claim of the appellant that they used ‘rent-a-cab service’ for transportation of their employees between the factory and prefixed points away from it. Further it is submitted that “air travel agents services’ were availed to enable the company’s executives to undertake air travels for business purposes. It is argued by the learned consultant for the appellant that both the services had a direct nexus with the appellant’s business activity and hence they should be recognized as “input services” defined under rule 2(l) of the CENVAT Credit Rules, 2004. In relation to ‘air travel agents service’, the learned consultant relies on CCE v. DCW Ltd. Final order No. 25 of 2011, dated 7-1-2011 (Cestat – Chennai). He also submits that the original authority has allowed CENVAT credit on rent-a-cab service’ and ‘air travel agents service’ for certain other periods viz. January to October 2008, January to September 2010 and October 2010 to March 2011. He has also produced copies of the relevant orders-in-original viz. order-in-original Nos. 13 to 15/2012 dated 2-9-2012.
2. It is submitted by the learned Superintendent A.R. that there is no evidence of the ‘rent-a-cab service’ having been used for transportation of employees in the aforesaid manner nor of ‘air travel agents service’ having been used by executives of the company for business purposes. With reference to the orders-in-original relied on by the learned Consultant, the learned Superintendent A.R. submits that these orders are amenable to review in the department and hence cannot be given any precedential value at this stage.
3. I have considered the submissions carefully. It was not the case of the department in the relevant show-cause notice that ‘rent-a-cab service’ was not used for transportation of employees or that ‘air travel agents service’ was not availed by the company’s executives for undertaking business travels. The case of the Revenue as made out in the show-cause notice was that the two services did not qualify to be input services for the purpose of CENVAT credit. If the ‘rent-a-cab service’ was used by the company for transporting their employees between the factory and their residential locations, the requisite nexus exists between the service and the manufacture of excisable goods in the factory. Similarly, if the air travels were undertaken by the company’s executives for business purposes, the necessary nexus between the service and the business activities of the appellant does exist. The show-cause notice did not even attempt to make out a case to the contra. Therefore, the case of the appellant is liable to be accepted. In regard to ‘air travel service’ the appellant also receives support from the Tribunal’s decision in the case of DCW Ltd. (supra). The orders-in-original produced by the Consultant for the appellant can be no basis for taking a view in their favour in much as ample time is left for the department to review those orders.
4. For the aforesaid reasons this appeal is allowed.