The Chennai Bench of Customs, Excise and Service Tax Appellate Tribunal ( CESTAT ) allowed CENVAT credit to Hindustan Unilever Ltd. on various input services related to job work, citing earlier rulings in the assessee’s favour.

Hindustan Unilever Ltd.,appellant-assessee, was engaged in manufacturing cosmetics under Chapters 33 and 27 of the CETA, 1985. During verification of ER-1 returns for December 2012 to June 2013, it was found that the company had availed CENVAT credit on services like godown rent, maintenance, loading/unloading, diesel for genset, DG hire charges, and electricity.

The department held that many of these services were not eligible for credit and that job work services received were exempt under Notification No. 25/2012-ST, making the credit inadmissible. Five show cause notices were issued, and duty demands of ₹3,49,549, ₹4,36,947, and ₹3,91,173 were confirmed along with penalties.

Appeals filed before the Commissioner (Appeals) were rejected, leading to the present appeals.

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The assessee counsel argued that the issue for the period December 2012 to June 2013 was already settled in the assessee’s favour in earlier Tribunal decisions involving the same company. He submitted that all the services in question were used in the manufacturing process and formed part of the cost of production, which was included in the assessable value of the final products on which excise duty was paid.

He stated that as per the CENVAT Credit Rules, any service used in manufacturing, unless specifically excluded, qualified as input service. Since the department did not claim that these services fell under the exclusions, the credit could not be denied.

He also contended that the demand was time-barred, as there was no suppression or misstatement to justify invoking the extended period. He requested that the impugned orders be set aside.

The departmental representative supported the findings of the lower authority.

A single member bench of M.Ajit Kumar (Technical Member) reviewed the appeal and relevant documents and noted that the issue had already been decided in the assessee’s favour in earlier cases. It observed that the disputed services such as godown rent, diesel, DG hire, electricity, and loading/unloading were used by job workers for job work activities.

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The department had denied credit, claiming that the services were used by job workers, whose services were exempt under Notification No. 25/2012-ST.

The tribunal referred to its earlier rulings in Hindustan Unilever-I and Hindustan Unilever-II, where it had held that the principal manufacturer was eligible to claim credit on input services used by job workers, as long as the services were related to the manufacture of final products. It also noted that similar credit had been allowed in the appellant’s own case for earlier periods.

Regarding services like factory compliance and management, which involved statutory obligations such as PF and ESI, the appellate tribunal held that these were also eligible for credit, as previously decided.

Since the issues had already been settled and no contrary ruling from a higher court was shown, the CESTAT followed judicial discipline, set aside the impugned order, and allowed all three appeals with consequential relief.

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