Outsource Partners International Private Limited Vs Commissioner of Central Tax And Central Excise (CESTAT Bangalore)
Summary: M/s Outsource Partners International Private Limited, engaged in Business Auxiliary Services and export of services, challenged denial of CENVAT credit on Works Contract Service and service tax paid on conducting Quiz Competition. The appellant contended that repair, renovation and maintenance of its leased office premises were essential for providing output services and were covered by the definition of Input Service under Rule 2(l) of the CENVAT Credit Rules, 2004.
It also relied upon Circular No.943/4/2011-CX dated 29.04.2011 and several CESTAT decisions supporting credit on repair and renovation services. The Tribunal held that the Works Contract Service related only to repair, renovation and maintenance of the existing leased office premises and was required for providing output services. Since the services did not relate to construction or execution of a works contract of a building or civil structure, they were not excluded under Rule 2(l). Following the cited decisions and the clarification in Circular No.943/4/2011-CX, the Tribunal held that denial of CENVAT credit on Works Contract Service was unsustainable and allowed the credit.
However, the Tribunal declined credit relating to conducting Quiz Competition, considering such activities to be recreational. The appeal was therefore partly allowed, with CENVAT credit on Works Contract Service allowed and credit on service tax paid for conducting Quiz Competition denied.
