By Puloma Dalal, Jayesh Gogri, Chartered Accountants
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Definition of “input services” is very wide and covers not only services which are directly or indirectly used in or in relation to the manufacture of final product but also after manufacturing of the final product
Facts:
The department denied CENVAT Credit on input services; viz. tour operator’s services, garden maintenance services, waste management services and repair of fan services on the grounds that these services were not integrally connected to the manufacture of final product and therefore, these were not eligible input services under Rule 2(l) of the CENVAT Credit Rules, 2004.
The respondents contended these to be eligible for the manufacturing process as the tour operator’s services were used for transporting their staff from residence to factory and back. Waste management services were a statutory requirement. So also garden maintenance was essential to keep the factory premises neat and clean and fans were installed in the factory and therefore, their maintenance was integral to manufacturing. Further, CENVAT Credit on waste management services and tour operator services was allowed by Tribunal in their own case.
Held
Relying on Ultratech Cement Ltd. 2010 (20) STR 577 (Bom.) and various other relevant decisions, CENVAT credit in respect of above services as well as in respect of services of photography, dry cleaning of uniforms of staff, construction for premises of manufacture, brokerage paid for selling products were held as input services eligible for credit.
