2011 (2) TMI 1275

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.... They are also providing service of renting of immovable property coming under Section 65(105) (zzzz) of Finance Act, 1994. The respondents have availed credit of excise duty paid on capital goods and inputs and service tax paid on input service. They have used the credit in CENVAT account for paying excise duty on the excisable goods cleared by them and also for paying service tax on the services rendered under the category of "Renting of Immovable Property". Show Cause Notice was issued alleging that the capital goods, inputs and input services on which credit was taken has no nexus with the renting of immovable property service and therefore the CENVAT credit could not be utilized by them and accordingly proposing demand of service tax o....

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....bsp;  "Whether or not, commercial or industrial construction or works contract service used for construction of an immovable property, could be treated as input service for the output service namely renting of immovable property service under the CENVAT Credit Rules, 2004?"     Classification     'Input credit of service tax can be taken only if the output is a 'service' liable to service tax or a 'goods' liable to excise duty. Since immovable property is neither 'service' or 'goods' as referred to above, input credit cannot be taken'. 5. Learned authorized representative strongly supports the order of the Commissioner (Appeals). 6. I have carefully considered the submissions from both sides an....

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....ce Act, 1994. Rule 3(1) enables a 'manufacturer' or a 'provider of taxable service' to take credit of specified duties and utilize them to discharge duty liability under Rule 3(4) of the CENVAT Credit Rules. A credit can be utilized for payment of any duty of excise on any final product or for payment of service tax on any output service. The respondent is undisputedly registered as a service provider for providing the services of renting of immovable property. The credit taken by them as manufacturer / service provider has been used both for paying excise duty and for paying service tax. The rules permit taking of credit under a common pool and permit use of the credit from the common pool for different purposes and there is no restriction....