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August 2011

(2011) 22 STR 578 (Tri.-Ahmd.) — Ultratech Cement Ltd. v. Commissioner of Central Excise, Bhavnagar.

By Puloma Dalal, Jayesh Gogri
Chartered Accountants
Reading Time 2 mins
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CENVAT credit of service tax — Whether vehicles used in residential colony of assessee and insurance on residential buildings includible within the scope of ‘input services’.

Facts:
The appellant was denied the credit of service tax paid on the vehicles used in the residential colony of the appellant as also the credit of service tax paid on the insurance of the residential building on the ground that the same could not be considered to be ‘input service’. It was contended that the issue involved in the present case was related to the credit of service tax paid on the services used in activities related to business which covered all activities related to functioning of a business.

Held:
Referring to a number of case laws and relying on the decisions in the case of Manikgarh Cement v. CCE & Cus., Nagpur 2008 (9) STR 554 (Tri.- Mumbai) and Millipore India Ltd. v. CCE., Bangalore 2009 (13) STR 616 (Tri.-Bang.), respectively, it was held that the definition of input service being quite wide, an activity used for business purposes was held as ‘input service’ and the assessee was entitled to the credit of service tax paid on vehicles used in the residential colony of assessee and insurance on residential buildings.

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