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CENVAT – Manpower supply services availed for maintaining a health centre in compliance with Rajasthan Factory Rules eligible for input service as directly in relation to manufacture
Facts:
The Assessee was a manufacturer of cement and clinker chargeable to excise duty. It sourced trained persons from manpower supply agents for maintaining medical/ health centre at its factory. Department denied CENVAT credit on the grounds that services had no nexus with manufacture.
Held:
The Tribunal observed that appellant in terms of Rule 65T of the Rajasthan Factories Rules was required to maintain an occupational health centre as its employees were more than 500 and they carried out hazardous operations. Unless the appellant complied with this provision of the Rajasthan Factories Rules, they would not be allowed to carry on their manufacturing activity. Accordingly, it was held that the service of receiving trained medical personnel through manpower supply agency for maintaining the occupational health centre has to be treated as in or in relation to manufacture of final product and would be eligible for CENVAT credit as input service.
Note: Readers may also note a similar decision in the case of Commissioner of Central Excise vs. M/s Lucas TVS Ltd. [2015-TIOL-1466-CESTAT-MAD} wherein it has been held that manpower supply to a canteen in the factory which is an obligation under the Factories Act is an eligible input service.
