COMMISSIONER OF CENTRAL EXCISE Vs. CABLE CORPORATION OF INDIA LTD

JUDGEMENT

(1.) THIS is Revenue's appeal.

(2.) Brief facts of the case are that the respondents have taken a credit of Rs. 59,706/- for the period May 2006 to March 2007 in respect of Service Tax paid by the Service provider i.e. Rent-A-Cab Scheme Operator. This credit was sought to be denied as the same was not considered as provided in relation to the production / manufacture of finished products directly or indirectly. The matter was adjudicated by Deputy Commissioner who denied the credit and ordered recovery of interest and also imposed a penalty of Rs. 10,000/- under Rule 15 of Cenvat Credit Rules, 2004.

(3.) REVENUE in its appeal has referred to some decisions of CESTAT wherein the term used in relation to manufacture or clearances of final product have been interpreted. It was submitted that the input service used must have some relation with the manufacturing activity and services for providing conveyance to the employees is no way a production or clearance related activity or service, because it is not playing any role in manufacture or clearance of goods and therefore cannot be considered as input service for which credit can be extended. If such a view is taken, then anything which is done for the benefit of the employees will have to be considered as input service, which certainly cannot be in the intention of legislature.