The Chandigarh bench of the Customs, Excise, and Service Tax Appellate Tribunal (CESTAT) has held that courier agency, exhibition, insurance and internet service fall under ‘input service’ under rule 2(l) of Cenvat credit rules, 2004.
M/s Zoloto Industries, the appellant engaged in the manufacture of valves and cocks falling under Chapter 84 of the First Schedule to the Central Excise Tariff Act, 1985 and are registered with the Central Excise and are availing Cenvat Credit of duty paid on inputs and capital goods and service tax paid on input services used in or about the manufacture of their final products.
A show cause notice denying the cenvat credit of service tax paid on the input services Courier Agency, Exhibition, Insurance, and Internet Service amounting to Rs. 57,597/- availed during the period January to March 2011, on the ground that the said services were not covered by the scope of the definition of ‘Input Service’ as defined under Rule 2(l) of the Cenvat Credit Rules, 2004.
Rule 2(l) makes eligible the imported goods inputs or capital goods. The third proviso (newly inserted) allows the imported goods to take credit for service tax paid.
After following the due process, the Superintendent vide order dated 19.11.2012 disallowed cenvat credit of Rs. 57,597/- and ordered for recovery of the same along with interest. He also imposed a penalty of Rs. 57,597/- under Rule 15 of the Cenvat Credit Rules, 2004. The Commissioner (Appeals) rejected the appeal of the Appellant.
A single-member bench comprising Mr S S Garg, (Judicial) observed that all the impugned services fall under the definition of input services and set aside the impugned order.
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