- (1.) This is an appeal under Section 35-G of the Central Excise and Salt Act (hereinafter referred to as "the Act"). The appellant availed Cenvat Credit on certain services. The adjudicating authority issued a show cause notice dated 6-6-2007 to the appellant to show cause as to why he should not disallow the Cenvat credit availed by the appellant on certain services, on the ground that there was lack of proper documents as prescribed under Rule 9(1) of the Cenvat Credit Rules, 2004 (hereinafter referred to as the "Rules") and that the services were not directly or indirectly used in or in relation to manufacture. The appellant submitted a reply submitting that the advertising expenses were incurred for sales promotion of the final products and consequently, the same was covered under the definition of "input service". In respect of bus transportation service, the appellant submitted that the same was utilised for official work or for transporting the staff to the factory and back and was therefore integrally connected with the business of the appellant.
(2.) The adjudicating authority, after considering the matter and examining the documents accepted the plea of the appellant and dropped the proceedings. The adjudicating authority held, that all the documentation required under Rule 9(1) of the Rules was properly maintained and was duly produced by the appellant and that the services on which Cenvat credit was being taken by the appellant was directly connected with the manufacturing and business activities of the appellant and was within the purview of the definition of "input service" as defined under Rule 2(1) of the Rules.
(3.) The department, being aggrieved, filed an appeal contending that bus service was not covered under the definition of motor cab, inasmuch as the capacity of the bus was more than six passengers and, therefore, service tax was not payable on bus service and consequently, Cenvat credit was not admissible. The department, however, admitted that the appellant had used the bus for its staff. In respect of event management service, the department took the ground that this outdoor activity was not organized within the factory premises of the appellant and therefore, such activity cannot be co-related with the manufacturing process and, consequently, no Cenvat credit on this service could be provided.;