The Customs, Excise and Service Tax Appellate Tribunal ( CESTAT ), Chennai has held that the soft drink manufacturers, Hindustan Coca-Cola is eligible for cenvat credit on the pest control services.
The appellants, Hindustan Coca-Cola Beverages Pvt. Ltd, engaged in the manufacture of aerated drinks and fruit juice, availed the facility of CENVAT credit on inputs and input services. The authorities disallowed the credit on the pest control services availed by the appellant for controlling pest in the said Godown.
The appellants contended that it is highly necessary to keep the godown pest-free as the sugar is used as input for finished products which are used for human consumption and therefore, the credit is allowable.
On appeal, the Tribunal held that “the appellant has taken the premises on rent outside the factory to store the inputs namely sugar. The pest control services have been availed by the appellant to make these premises pest free. The product stored by the appellant being sugar and is being used as input for aerated beverages which are used for human consumption, it is essential that the premises are to be kept pest free. For this reason, I am of the view that the pest control services availed by the appellant are input services and therefore the same is eligible for the credit. The disallowance of credit is unjustified and requires to be set aside, which I hereby do.”