Cenvat Credit: Housekeeping and gardening services

Housekeeping and gardening services availed to maintain factory in eco-friendly manner are eligible for credit

[2015] 57 taxmann.com 131 (Madras)

HIGH COURT OF MADRAS

Commissioner of Central Excise and Service Tax

v.

Rane TRW Steering Systems Ltd.

Rule 2(l) of the Cenvat Credit Rules, 2004 - Cenvat Credit - Input service - Housekeeping Services - Assessee, manufacturer of parts of power steering systems, etc. took credit of 'housekeeping, landscaping and gardening' services - Department denied credit on ground that same has no nexus with manufacture and clearance upto place of removal - HELD : Where an assessee spends money to maintain their factory premises in an eco-friendly manner, tax paid on such services would form part of cost of final products and same would fall within ambit of 'input services' and, therefore, assessee is entitled to claim benefit - Hence, credit of services in question was allowed [Paras 7 to 9] [In favour of assessee]

Section 27,:No refund without challenging assessment order

Assessee can't claim exemption by way of refund without challenging assessment order

[2015] 57 taxmann.com 403 (Madras)

HIGH COURT OF MADRAS

Commissioner of Customs (Appeals)

v.

Ace Designers

Section 27, read with sections 46, 50 and 149, of the Customs Act, 1962, section 11B of the Central Excise Act, 1944 and section 83 of the Finance Act, 1994 - Refund - General - Assessee exported a machine but on non-receipt of payment therefor, re-imported same on 13-8-2001 - Re-import was assessed to 4 per cent Special CVD/SAD duty - Assessee claimed that it was eligible for exemption, but, in order to avoid demurrage, it had paid 4 per cent SAD and, therefore, it was entitled to refund of SAD duty paid - Assessee filed refund claim on 11-10-2001 - Department denied refund claim on ground that SAD was payable on re-imports also and in any case, no refund claim could be entertained so long as assessment order stood unchallenged and non-modified - HELD : Assessee had taken a new plea at time of refund claim by placing reliance on notification no.18/2000-Cus., which was not claimed in bill of entry, as assessed - Having not challenged order of assessment, assessee cannot, at a belated stage, claim refund by pressing into service another notification - Hence, refund claim was rejected as non-maintainable [Paras 12 to 15] [In favour of revenue]

Circulars and Notifications : Notification No.94/96-Cus dated 16-12-1996, Notification No.18/2000-Cus.N

Section 4 :Cost of packing for safe transport isn't includible in value of goods

Cost of packing/safety material meant for safe transport isn't includible in value of goods

[2015] 57 taxmann.com 296 (SC)

SUPREME COURT OF INDIA

Commissioner of Central Excise, Chennai

v.

Addisons Paints & Chemicals Ltd.

Section 4 of the Central Excise Act, 1944 - Valuation under Central Excise - Transaction value - Packing - Period prior to 1-7-2000 - Assessee, a manufacturer of paints and varnishes, used to pack them in tins and plastic containers, which were then put in carton boxes for purpose of transportation - Similarly, in another case, a manufacturer of parts of sheet glass used wooden packing for safety during transport - Assessees claimed that cost of cartons/wooden packing was not includible in value - HELD : Packing is includible in value only if it is done in order to put goods in marketable condition and not when goods are capable of reaching market without said packing - If goods are generally sold in wholesale market at "factory gate", use of cartons for transportation "from factory gate" for sale to individual customers or as stock transfers cannot be included in value - Similarly, since wooden packing is not a requirement for sale at "factory gate", same cannot be included in value [Paras 6 to 8] [In favour of assessee]