Saturday, May 25, 2013

Services availed for market research and customer’s credit rating are eligible for input credit

Management consultancy service availed by assessee relating to conduct of 'market research' and customers 'credit rating' in international market to improve its market condition abroad is eligible for input service credit

In the instant case, the assessee availed of management consultancy service relating to conduct of market research and customers credit rating in international market to improve its market condition abroad. The Department denied credit on ground that that there was no nexus of these services with manufacture.

The Tribunal held as under:

1. The definition of input services in the inclusive portion clearly includes market research services on which credit is available;

2. Credit rating of customers also relatables to sales promotion and business of manufacture. In any case, as the activity was specifically included in the definition of input services, credit thereof couldn’t be denied -  Gujarat Reclaim & Rubber Products Ltd. v. Commissioner of Central Excise [2013] 33 276 (Ahmedabad - CESTAT)