TaxTMI Login
Just a moment...
Press 'Enter' to add multiple search terms. Rules for Better Search
When case Id is present, search is done only for this
of 
of 
No Folders have been created
Are you sure you want to delete "My most important" ?
NOTE:
of of 
All Case Laws
of of All Case Laws
Note
Bookmark
Share
Don't have an account? Register Here
of <h1>CENVAT Credit Allowed on Civil Construction Services Before 2011 Amendment Under Input Services Rules</h1> <h3>Commissioner Central Excise Commissionerate, Delhi-III Versus M/s Bellsonica Auto Components India P. Ltd.</h3> Commissioner Central Excise Commissionerate, Delhi-III Versus M/s Bellsonica Auto Components India P. Ltd. - 2015 (40) S.T.R. 41 (P & H), [2016] 87 VST 63 ... ISSUES: Whether the Cenvat Credit of Service Tax paid on civil construction services related to immovable property (factory) is admissible as input service under the Cenvat Credit Rules, given that the factory is neither a service nor goods'Whether civil construction services can be defined as an input service under Rule 2(l) of the Cenvat Credit Rules, 2004, considering if such services have any relation to the manufacturing process or business activity of the manufacturer? RULINGS / HOLDINGS: The Tribunal's decision allowing Cenvat Credit of Service Tax paid on civil construction services for setting up the factory premises was justified, as these services fall within the wide definition of 'input service' under Rule 2(l)(ii), being 'used by the manufacturer, whether directly or indirectly, in or in relation to the manufacture of final products and clearance of final products.'Civil construction services used in relation to setting up a factory are explicitly included within the definition of input service, and the factory and leased land are used 'directly or indirectly in or in relation to the manufacture of the final product.'The Commissioner's view that immovable property is neither service nor goods and hence input credit is inadmissible was rejected as it unduly restricts the scope of 'input service' and ignores the inclusive language of Rule 2(l)(ii).The amendment in 2011 excluding construction services from the definition of input service is not retrospective and thus not applicable to the period under consideration (2007-08 to 2009-10). RATIONALE: The Court applied the statutory framework of the Cenvat Credit Rules, 2004, particularly Rule 2(l)(ii), which defines 'input service' broadly to include services 'used by the manufacturer, whether directly or indirectly, in or in relation to the manufacture of final products' and expressly includes services 'used in relation to setting up ... of a factory.'The Court emphasized the inclusive nature of the definition, noting the phrase 'includes services' as indicative that the listed services are illustrative, not exhaustive.The Court relied on a Division Bench judgment interpreting the definition of input service as comprising independent categories, any one of which suffices to allow credit, thereby supporting the inclusion of civil construction services related to factory setup.The Court rejected the Commissioner's narrow interpretation that excluded services related to immovable property, holding that such an approach would unduly limit the scope of input services and contradict the statutory language.The Court noted the 2011 amendment excluding construction services from input services but held it not applicable retrospectively, thus preserving the respondents' entitlement for the relevant period.
TaxTMI 
TaxTMI 
