Case Law Details
CESTAT, AHMEDABAD BENCH
Commissioner of Central Excise
Versus
Schatt Glass India (P.) Ltd.
ORDER NOS. A/1544 TO 1547/WZB/AHD/2012
APPEAL NOS. E/577 & 578 OF 2011
E/CO/4 & 5 OF 2012
OCTOBER 22, 2012
ORDER
1. Both the appeals filed by the Revenue and the cross objections filed by the assessee are on the same issue, but covering different periods and therefore both the appeals and the cross objections are taken together and final order is being passed.
2. The issue involved is as to whether the assessee is eligible for the benefit of CENVAT Credit of Service Tax paid on rent-a-cab utilized for transportation of employees from Vadodara to the factory in village Ankhi, about 40 kms. away.
3. Heard both the sides.
4. Ld. A.R. submits that credit is not available in view of the decision of Hon’ble Supreme Court in the case of Maruti Suzuki Ltd. v. CCE 2009 (240) ELT 641 and the decision of the Tribunal in the case of CCE v. Sundaram Brake Linings [2010] 28 STT 435 (Chennai – CESTAT). He submits that there is no nexus with the manufacture and therefore credit is not admissible.
5. Ld. Counsel for the respondent relies upon the decision of the Tribunal in the case of CCE v. J.K. Cement Works [2009] 20 STT 254 (New Delhi – CESTAT).
6. I have considered the submissions made by both sides. I find that the decision of the Tribunal in the case of J.K. Cement Works (supra) directly covers the issue before me. As regards the submissions of the ld. A.R., I find that in the case of CCE v. Ultratech Cement Ltd. [2010] 29 STT 244 (Bom.), Hon’ble High Court of Mumbai has considered the issue of eligibility of Service Tax paid on various services and Hon’ble High Court has considered the decision of Hon’ble Supreme Court in the case of Maruti Suzuki Ltd. (supra) also and then came to the conclusion that CENVAT Credit benefit will be available if the service can be related to the business of manufacture. In this case, the factory is located in a village and the village does not have adequate facilities for employees and therefore to get the proper employees, it becomes necessary for the assessee to provide transportation facility from the nearest city. Therefore, it cannot be said that the assessee is providing transportation facility to its employees as a welfare measure, but it is necessity to ensure that the manufacture takes place properly. Therefore, in the case before me, it can be said that the service has a relation to the business of manufacture and has a nexus. As regards the decision in the case of Sundaram Brake Linings (supra), the Hon’ble Member has not considered the decision in the case of Ultratech Cement Ltd. (supra) and therefore I hold that it need not necessary be followed. In view of the observations, I find that the Department has not made out a case for rejection of the claim.
7. Accordingly, the appeals filed by the Revenue are rejected. The cross objections filed by the assessee also gets disposed of.
