Cenvat Credit on construction inputs and input services applies when commercial property is rented, allowing credit to the assessee.

Cenvat credit is held admissible on inputs and input services used in construction of commercial property that is subsequently given on rent; the operative principle is a sufficient nexus between the inputs/input services and the output service of renting immovable property. The note applies prior authoritative precedent recognizing credit where construction inputs/services are used to create rentable commercial premises, and concludes the assessee is entitled to claim credit on those inputs and input services.

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Issues: Whether cenvat credit is admissible on inputs and input services used in the construction of a commercial property which is subsequently given on rent.

Analysis: The Tribunal considered whether a nexus exists between the inputs/input services used in construction and the output service of renting immovable property. The Tribunal followed earlier authoritative decisions, including the Karnataka High Court decision in Commissioner of Service Tax vs. Golflinks Software Park Pvt. Ltd. and the Tribunal decision in Bharati Realty Ltd. vs. CCE, which hold that cenvat credit is admissible where inputs/input services are utilized in construction of commercial property later given on rent. Applying these precedents, the Tribunal found the facts of the present case covered by those rulings and accepted the appellant's entitlement to credit.

Conclusion: Cenvat credit on inputs and input services used in construction of commercial property later given on rent is admissible; decision is in favour of the assessee.

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