1. The issue involved is the admissibility of Cenvat credit on the input service namely Goods Transport Agency Service, Renting-a-Cab Service, Catering Service, Air and Rail Booking Service, Authorized Service Station. Shri. S.L. Gundecha, Ld. Counsel for the appellant submits that as regard the GTA service they have admittedly reversed the Cenvat credit before issuance of show cause notice therefore in terms of Section 11A (2B) no show cause notice to be issued consequently no penalty should not have been imposed. He further submits that Cenvat on GTA service, the issue is highly debatable and still matter is pending in the Hon'ble Supreme Court in case of Commissioner v. ABB Ltd : 2011 (23) S.T.R. 97 (Kar.)as well as Commissioner v. Vesuv
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ious India Ltd : 2014 (34) S.T.R. 26 (Cal.)therefore issue involved is of interpretation of law there are and various contrary judgments on the issue. For this reason no malafide intension can be attributed, accordingly, no penalty should be imposed. As regard other service, He submits that all the services were used in or in relation to the manufacture of the final product or business activity of the appellant. In the appeal memo as well as in the synopsis given at the time of hearing, he described the use of service, accordingly all the services were used in or in relation to the manufacture of final product as well as for business activity. Ld. Commissioner disallowed the credit despite accepting that the service used by the appellant but it is of welfare activity. He further submits that all these services have been consistently held as admissible input service. He placed reliance on the following judgments:
(a) Coca Cola India Pvt Ltd Vs. Commissioner of C. Ex. Pune-III [2009 (242) ELT 168 (Bom)]
(b) Commissioner of C. Ex. Nagpur Vs. Ultratech Cement Ltd [2010 (260) ELT 369 (Bom)]
2. On the other hand Shri. Sanjay Hasija, Ld. Superintendent (A.R.) appearing on behalf of the Revenue reiterates the findings of the impugned order.
3. I have carefully considered the submissions made by both sides.
4. The dispute is related to admissibility of input service credit namely Goods Transport Agency Service, Rent-a-Cab Service, Catering Service, Air and Rail Booking Service, Authorized Service Station. As regard the GTA service appellant has admittedly reversed the credit before issuance of show cause notice, we observed that as regard this service, the only issue remains is whether the penalty was rightly imposed or otherwise. We find that firstly appellant reversed the credit alongwith interest before issuance of show cause notice. Secondly the issue is not free from grave interpretation of law as various contrary judgments were passed and issue is pending before the Hon'ble Supreme Court in case of Commissioner v. ABB Ltd : 2011 (23) S.T.R. 97 (Kar.) as well as Commissioner v. Vesuvious India Ltd : 2014 (34) S.T.R. 26 (Cal.) In this position it cannot be said that appellant had any malafide intention in availing wrong credit on GTA service therefore in terms of Section 11A (2B) the show cause notice should not have issued atleast on the Cenvat credit on GTA service, consequently no penalty would sustainable. We therefore set aside penalty attributed to GTA service. The reversal of Cenvat credit alongwith payment of interest is maintained. As regard other service, we find that as per appellant's submission, the nature of services and used there of are given as under:
(a) Rent-a-Cab Services:
The Rent-a-Cab services availed by the appellant for its employees, many of whom are related to the manufacture activity and others are related to the business of the appellant as a manufacture of excisable goods. It is not sustainable, considering the definition of input service, prevalent during the relevant period, nor such credit can be denied on the ground that it was an "optional facility", granted by the appellant to its employees.
Considering the above, we are of the view that service was indeed related to manufacturing and Business Activity of the appellant. The issue of Cenvat credit on Rent-a-Cab Service was decided by this tribunal in the following judgments:
(a) Coca Cola India Pvt. Ltd. Versus Commissioner of C. Ex., Pune-III [2009 (242) E.L.T. 168 (Bom.)]
(b) Commissioner of C. Ex., Nagpur Versus Ultratech Cement LTD. [2010 (260) E.L.T. 369 (Bom.)]
(c) Principal Commissioner Versus ESSAR Oil Ltd. [2016 (41) S.T.R. 389 (Guj.)]
(b) Air & Rail Travel Booking Services:
Air & Rail Travel Bookings Services are used for booking tickets for various employees of the appellant, working in various Departments like production, marketing and purchase. The travels undertaken, for the business of the Company. Only the act being administrative act cannot take away the status of the services availed by the appellant as an input service, nor the activity is a welfare activity or a welfare measure as alleged in the impugned order.
We observed that the business of any company, travel of their executive and staff is necessary requirement in relation to the various activity of the company such as marketing, purchase etc, therefore travelling of the executive and staff is inevitable to run the business therefore service is related to travelling i.e. Air & Rail Travel Booking Services is necessary service for running the business hence in our view credit is admissible. Tribunal decided this issue in the following judgments:-
(i) Coca Cola India Pvt. Ltd. Versus C. Ex., Pune-III [2009 (242) E.L.T. 168 (Bom.)]
(ii) Reliance Industries Ltd. Versus Commissioner of C. Ex. & S.T., LTU, Mumbai [2016 (45) S.T.R. 383 (Tri. - Mumbai)]
(c) Outdoor Catering Services:
The canteen services are mandatorily provided considering the provisions of the Factories Act 1948 and being a welfare activity does not result in the concerned services ceasing to be an input service.
Since Outdoor Catering Service is mandatorily requirement for factory it is part and parcel of the overall manufacturing activity. Accordingly, the Cenvat credit is admissible. Appellant also get support from following judgments:
(i) Commissioner of C. Ex, Nagpur vs. Ultratech Cement Ltd. [2010 (260) ELT 369 (Bom)]
(ii) Commissioner v. Relpol Plastic Products Ltd. - 2016 (42) STR J274 (Bom)]
(d) Authorized Service Station:
Authorized Service Station services availed in respect of the vehicles used by the company for its operations. Company's factory situated outside city limits. Vehicles owned by the Company used by employees and others, hence the service is an input service.
In the following judgments credit on authorized service station was allowed.
a) Cocoa Cola India Pvt Ltd. v. Commissioner of C. Ex, Pune- III [2009 (242) ELT 168 (Bom)]
b) Reliance Industries Ltd. v. Commissioner of C. Ex, & ST, LTU, Mumbai [2016 (45) STR 383 (Tri-Mumbai)]
In view of the above, we find that except GTA in all the above service credit is admissible therefore demand of cenvat credit in respect of Renting-a-Cab Services, Catering Services, Air and Rail Booking Services and Authorized Station Services are set aside and consequent penalty and interest also set aside. The impugned order stands modified to the above extent. Appeal is partly allowed in the above terms