Appellants denied Cenvat credit for construction materials by Tribunal. Compliance required for partial pre-deposits.

The Tribunal held that the appellants were not eligible for Cenvat credit on central excise duty paid on inputs and capital goods used in the construction of their malls. It was determined that the contractors, not the appellants, utilized these materials and services directly for the construction. The Tribunal directed the appellants to make partial pre-deposits to secure the Revenue's interests, with compliance required by a specified date. Upon compliance, the need for further pre-deposits and recovery of outstanding amounts would be suspended until the appeals' resolution.

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Issues Involved:
1. Eligibility for Cenvat credit of central excise duty on various inputs and capital goods.
2. Eligibility for Cenvat credit of service tax paid on various input services.
3. Dispute regarding Cenvat credit of Rs. 54,53,290/- due to unavailability of original invoices (specific to EWDPL).
4. Liability to pay service tax of Rs. 54,545/- on reverse charge basis for GTA services received (specific to NMCPL).
5. Limitation period for Cenvat credit demand.

Detailed Analysis:

1. Eligibility for Cenvat Credit of Central Excise Duty on Various Inputs and Capital Goods:
The appellants, who are in the business of setting up and managing shopping centers, had their malls constructed through contractors. The primary issue was whether the appellants were eligible for Cenvat credit on central excise duty paid on inputs like steel, cement, glass, and capital goods like lifts used in the construction of the malls. The Tribunal held that the appellants were not eligible for Cenvat credit on these inputs and capital goods because these were used by the contractors for providing the construction service, not by the appellants directly for their output services. The Tribunal distinguished this case from the precedent set by the Andhra Pradesh High Court in the case of CCE, Visakhapatnam - II vs. Sai Sahmita Storages (P) Ltd., where the storage warehouses were constructed by the assessee themselves.

2. Eligibility for Cenvat Credit of Service Tax Paid on Various Input Services:
The appellants argued that since they paid service tax on the rent received from leasing mall space and on the maintenance and management charges, they should be eligible for Cenvat credit on the service tax paid on input services used in the construction of the malls. However, the Tribunal held that the appellants would not be eligible for Cenvat credit on the service tax paid on input services used by the contractors in the construction of the malls. The Tribunal noted that the contractors, not the appellants, were the ones who used these input services.

3. Dispute Regarding Cenvat Credit of Rs. 54,53,290/- Due to Unavailability of Original Invoices (Specific to EWDPL):
In the case of EWDPL, there was a specific issue regarding the Cenvat credit of Rs. 54,53,290/- due to the unavailability of original invoices. The Tribunal did not provide a detailed analysis on this issue in the order but implied that such matters require thorough examination during the final hearing.

4. Liability to Pay Service Tax of Rs. 54,545/- on Reverse Charge Basis for GTA Services Received (Specific to NMCPL):
For NMCPL, there was a specific dispute regarding the liability to pay service tax amounting to Rs. 54,545/- on reverse charge basis for GTA services received. The Tribunal did not provide a detailed analysis on this issue in the order but implied that such matters require thorough examination during the final hearing.

5. Limitation Period for Cenvat Credit Demand:
The appellants contended that the bulk of the Cenvat credit demand was time-barred, arguing that they had disclosed relevant facts in their ST-3 returns. The Tribunal noted that the issue of limitation is a mixed question of facts and law that requires detailed examination during the final hearing. Therefore, no final view on the plea of time bar was expressed at this stage.

Conclusion:
The Tribunal directed the appellants to make partial pre-deposits to safeguard the interests of the Revenue. Specifically, the amounts to be deposited were Rs. 3 crores by EWDPL, Rs. 4 crores by NMCPL, and Rs. 2.25 crores by NTPBL. Upon compliance, the requirement for pre-deposit of the remaining amounts of Cenvat credit demands, interest, and penalties would be waived, and recovery stayed until the disposal of the appeals. Compliance was to be reported on 08/07/2014.

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