1. This appeal filed by the assessee is against demand of Service Tax and education cess totalling to Rs. 88,123/- for the period from January to August, 2009. The authorities below denied Cenvat credit to the said extent on "Outdoor Catering Service" and "Repair/Maintenance of Guest House" on the ground that these were not "input services" defined under Section 2(l) of the Cenvat Credit Rules, 2004. They also demanded interest on the Cenvat credit amount.

2. The learned consultant for the appellant submits that they were entitled to take Cenvat credit during die above period on 'outdoor catering service' which was used in their factory canteen for free supply of food to the factory workers. In this connection, the learned consultant relies on Final Order No. 898/2010, dated 26-5-2010 passed by this Bench in Appeal No. E/l 141/2009 filed by the same assessee for a previous period. In the cited case, the learned Single Member relied on the Tribunal's Larger Bench decision in CCE v. GTC Industries Ltd. [2008] 17 STT 63 (Mum.-CESTAT) as also a decision of the Tribunal reported as Stanzen Toyotetsu India (P.) Ltd. v. CCE [2009] 21 STT 321 (Bang.-CESTAT). It is pointed out by the learned consultant that the Tribunal's decision in Stanzen Toyotetsu India (P.) Ltd. case has been upheld by the Hon'ble Karnataka High Court vide CCE v. Stanzen Toyotetsu India (P.) Ltd. [2011] 32 STT 244. In all the cited cases, Cenvat credit was allowed on 'outdoor catering service'. As regards 'maintenance/repairs of guest house', the learned consultant submits that, as the guest house was used for accommodating business guests and conducting business conferences, its repairs and maintenance had a real connection with the business activities of the company and hence should be considered as 'input service' for the purpose of CENVAT credit. In this context, reliance is placed on CCE v. Hindustan Zinc Ltd. [2009] 21 STT 285 (Bang.-CESTAT) wherein the assessee's submission that guest house was used for accommodating business men visiting the factory in connection with its business was accepted and, accordingly, 'maintenance of guest house' was held to be 'input service' for Cenvat credit purpose.

3. The learned Superintendent (AR) submits that the appellant did not employ 250 or more workers in their factory at any point of time during the period of dispute and, therefore, they did not have any statutory obligation to maintain a canteen for the workers and consequently, there is no nexus between the appellant's business of manufacture and marketing of excisable products and the use of 'outdoor catering service' for supply of food to the workers. In this connection, reliance is placed on the Hon'ble High Court's judgment in Stanzen Toyotetsu India (P) Ltd. case (supra). Further, it is pointed out that, in Final Order No. 898/2010 ibid, the number of workers employed by the assessee during the material period was overlooked by the Bench while holding in their favour on the question whether 'outdoor catering service' used in factory canteen for supply of food to the workers could be treated as an 'input service'. With regard to 'guest house maintenance service', it is submitted that no nexus was found between this service and the manufacture of goods in the case of Hindustan Zinc Ltd. v. CCE .

4. In his rejoinder, the learned consultant submits that the show cause notice in this case had not proposed to deny Cenvat credit on 'outdoor catering service' on the basis of number of workers employed by the noticee during the material period. According to him, the respondent cannot raise such a plea at appellate stage. In answer to a query from the Bench, the learned consultant fairly submits that, during January to August, 2009, the appellant had employed less than 250 workers including temporary workers. The documents produced by him indicate that the number of permanent workers employed during the said period is 127 - 128 and the total number of temporary worke