Order Date – 22 December 2022

Facts –

• The Appellant, M/s Reliance Industries Ltd, manufacturer of excisable goods at their facility in Vadodara.
• A show cause notice dated 13th October 2010 was issued for denying CENVAT credit being premium paid for group insurance to cover employees opting for ‘voluntary separation scheme (VSS)’ in March 2010.

Issue –

• Whether the CENVAT can be availed on premium paid on VSS?

Order –

• The Tribunal relied on the decision of the Larger Bench of the Tribunal in Reliance Industries Ltd v. Commissioner of Central Excise & Service Tax (LTU), Mumbai [2022-TIOL-336-CESTAT-MUM-LB], in which it was held that It is thus clear from CAS-7 that medical benefits pertaining to employees and dependents, even if they are in terms of VRS/retirement/separation schemes, are an integral part of the ‘employee cost’.
• In view of the precedent decision in an identical dispute of the very same appellant, it set aside the impugned order and allows the appeal.