CENVAT Credit on services used subsequent to manufacture – CESTAT Order Stayed
REMEMBER the landmark judgement of the Chennai Bench of the CESTAT in the Chemplast Sanmar case – 2010-TIOL-180-CESTAT-MAD?
The CESTAT ruled that
There is no power with the Government to make rules to provide for credit in respect of service tax paid on input services which is used neither in or in relation to manufacture of excisable goods nor for providing taxable output service.
The services which are used by the manufacturer subsequent to completion of the manufacturing and for sale of the goods cannot, therefore, be considered as input service in or in relation to manufacture.
The Madras High Court has stayed this order.
Please see Chemplast v Commissioner of Central Excise -