TaxTMI 
TaxTMI 
2011 (2) TMI 677
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....ator-loaders and earth moving machines, chargeable to central excise duty under Chapter 84 of the Central Excise Tariff Act, 1985. They also avail cenvat credit of central excise duty paid on the inputs and capital goods and of service tax paid on the input services, as per the provision of Cenvat Credit Rules, 2004. The Appellant in respect of the 'excavator-loaders and earth moving machines' sold to their customers, provide free after sale repair and maintenance services during the warranty period and for providing such services, they have agreements with their dealers. In terms of their agreements, the dealers provide after sale service of repair and maintenance to the customers of the Appellant and while the dealers do not charge any amount from the customers of the Appellant, they send the bills in respect of the repair & maintenance jobs performed to the Appellant, who make the payment to them. The dealers have paid service tax on the service of repair and maintenance provided by them to the customers of the Appellant in terms of their agreement and the Appellant had taken cenvat credit of that service tax. It appears that the Department came to know about this service tax cr....
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....ce' in Rule 2(l) of Cenvat Credit Rules, 2004 - "the activity relating to business, such as accounting, auditing, financing, recruitment and quality control, coaching and training, computer networking, credit rating, share registry, and security, inward transportation of inputs or capital goods and outward transportation upto the place of removal", is not an exhaustive expression and would cover all the activities relating to the business of manufacturer; that the aforesaid services during warranty period provided to customers being in respect of sale of excavator-loaders and earth moving machine are 'activity relating to business' and the same would also fall within activities relating to sales promotion; that although the inclusive part of the definition of 'input service' clearly includes the activities of servicing relating to the sale of equipment, the learned Commissioner in the impugned order has not even considered the applicability of inclusive part of the definition of the 'input service' and the order is only based on the applicability of clause (ii) of the main definition of the input service; that the Tribunal in the case of C.C.E., Vadodara v. Danke Products reported ....
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....rvice cannot be treated as 'input service' within the meaning of this term as defined in Rule 2(l) of the Cenvat Credit Rules, 2004; that the judgment of the Tribunal relied upon by the Appellant in their memorandum of appeal - Rohit Surfactants Pvt. Ltd. v. C.C.E., reported in 2009 (240) E.L.T. 472 (T.) = 2009 S.T.R. 169 (Tri.), C.C.E., Mumbai v. GTC Industries reported in 2008 (12) S.T.R. 468 (Tri.-LB.) and C.CE., Raipur v. Raipur Rotocast Ltd. reported in 2010 (18) S.T.R. 466 (Tri.) are not applicable to the facts of these cases, as in those cases, the services in respect of which cenvat credit was sought to be denied had been received by the assesees, while in the present case, the service, in question, - free repair and maintenance during warranty period, had not been received by the Appellant, but had been received by the customers of the Appellant from certain dealers; that the longer period of limitation of 5 years is available to the Department as the Appellant had never disclosed the availing of credit of service tax being paid by their dealers and this fact came to the notice of the Department only in the course of audit of their records and in view of this, the extended....
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.... of revenue. Hon'ble Allahabad High Court in the case of L.G. Electronics India Pvt. Ltd. v. C.C.E., Noida reported in 2009 (16) S.T.R. 136 (All.) has held that uniform view of the various High Courts of the country on the question of the pre-deposit of duty and penalty under Section 35F has been that while considering provisions of the pre-deposit of duty and penalty, the authority concerned has to examine the question whether the Appellant has a good prima facie case so as to justify the dispensation of requirement of pre-deposit of the disputed amount of duty and penalty and the authority must exercise its discretion to dispense with such requirement particularly, in a case where Appellant satisfies the appellate authority that his case is squarely covered by the decision of a competent court binding on it and in such cases, asking the Appellant to deposit the duty and penalty levied would cause undue hardship to the Appellant. The Hon'ble Supreme Court in the case of Benara Valves Ltd. v. C.C.E. reported in 2006 (204) E.L.T. 513 (S.C.) = 2008 (12) S.T.R. 104 (S.C.) and in the case of Indu Nissan Oxo Chemicals Industries Ltd. v. UOI reported in 2008 (221) E.L.T. 7 (S.C.) has hel....
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.... (l) "input service" means any service, - (i) used by a provider of taxable service for providing an output service, or (ii) used by the manufacturer, whether directly or indirectly, in or in relation to the manufacture of final products and [clearance of final products upto the place of removal, and includes services used in relation to setting up, modernization, renovation or repairs of a factory, premises of provider of output service or an office relating to such factory or premises, advertisement or sales promotion, market research, storage upto the place of removal, procurement of inputs, activities relating to business, such as accounting, auditing, financing, recruitment and quality control, coaching and training, computer networking, credit rating, share registry, and security, inward transportation of inputs or capital goods and outward transportation upto the place of removal". Thus, the definition of input service has two components - (i) the main definition clause and (ii) inclusive portion. One of the item in the inclusive portion of the definition is - "activity relating to business, such as accounting, auditing, financing, recruitment a....