2015 (39) STR 350 (Tri.-Bang.) CCE, Cus. & S. T., Visakhapatnam – I vs. Hindustan Petroleum Corp. Ltd.

Facts:
The
respondents availed health insurance services in March, 2011, payment
for which was made in March, 2011. However, the insurance was for the
period from April, 2011 to September, 2011. CENVAT credit on such
services was availed in March, 2011. Definition of input services was
substantially amended with effect from 1st April, 2011 with specific
exclusions. One such exclusion was in relation to insurance services,
when such services are used primarily for personal use or consumption of
employees. Accordingly, the department denied CENVAT credit since the
period of insurance was effective from 1st April, 2011. Commissioner
(Appeals) referred to Point of Taxation Rules, 2011 and also the
definition of Point of Taxation and concluded that CENVAT credit was
allowable to the extent of completion of provision of services prior to
1st April, 2011.

Held:
It is an undisputed fact that
services were availed prior to amendment, payment was made prior to
amendment and even CENVAT credit was taken prior to amendment.
Accordingly, provisions post amendment would not be applicable to the
activities completed prior to the date of amendment. As per the
definition, “Point of Taxation” means the point in time when a service
shall be deemed to have been provided. Accordingly, since everything was
completed in March, 2011, CENVAT credit was available.