AI OCR 
TaxTMI 
TaxTMI 
TaxTMI 
2011 (4) TMI 975
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....ll these Tax Appeals, legal issue arising is common. These appeals therefore have been heard together and are being disposed of by this common order. 2. For the purpose of this order, we may notice the facts as emerging in Tax Appeal No. 419/2010. 3. Revenue is in appeal against the judgment of the Customs, Excise & Service Tax Appellate Tribunal (Tribunal for short) dated 28-7-2009. By the impugned order, the Tribunal allowed the respondent-assessee's appeal and directed granting Cenvat credit on the service tax paid on the outward transportation of the goods from the factory gate to the customers' premises. The Tribunal in its short order, relied on the Larger Bench decision in the case of ABB Ltd. and Ors. v. C.C.E. & S.T., Bangalore & Ors. reported in 2009 (92) RLT 665 = 2009 (15) S.T.R. 23 (Tribunal-LB). 4. Though the question framed by the appellant is somewhat different, we re-frame the question for the purpose of deciding all appeals as follows :- "Whether in the facts of the case, the Tribunal was justified in holding that the assessee was entitled to avail Cenvat credit on the service tax paid on GTA service on outward transportation of the goods beyond ....
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.... stated, case of the assessee is that service tax paid on GTA for outward transportation of the goods even beyond the place of removal is eligible for Cenvat Credit in view of the definition contained in Rule 2(l) of the Cenvat Credit Rules defining the term "input service". On the other hand, stand of the department is that for outward transportation of the goods beyond the place of removal, no credit can be claimed on the service tax paid. It is further the case of the Revenue that in any case, without establishing that the sale was on FOR basis, that the goods were delivered by the assessee at his cost at the door-step of the purchaser, the assessee cannot take the benefit of Board's circular dated 23-8-2007. 9. On the basis of the above facts, counsel appearing for either sides have made detailed submissions before us. Appearing for the Department, learned counsel Shri Darshan Parikh contended that in view of the definition of 'input service' under Rule 2(l) of the Cenvat Credit Rules, no credit can be availed for service tax paid on outward transportation beyond the place of removal. He drew our attention to the statutory provisions applicable and relied on the following de....
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....terest must be the owner of the property." (iii) In the case of Prabhat Zarda Factory Ltd. v. Commissioner of Central Excise, 2002 (146) E.L.T. 497 (S.C.), the Apex Court followed the earlier judgment in the case of Escorts JCB Ltd. (supra). (iv) In the case of Commissioner of Central Excise v. Accurate Meters Ltd., 2009 (235) E.L.T. 581 (S.C.), the Apex Court was examining the question whether the freight and insurance charges constitute the value of goods for the purpose of computation of excise duty. In that case, the assessee was engaged in manufacturing electric meters and supplied the same to the State Electricity Boards in terms of advertisement under which the value of electric meters was to be fixed at the factory gate and freight and insurance charges were to be charged on an average basis and not on actuals. In this background, the Apex Court held that : "In that view of the matter and for the reasons stated hereinabove, we have no doubt in our mind that the authority in appeal as also the Tribunal were correct in their view that the amount claimed by way of transportation charges and insurance cannot be considered for determining the value of ....
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....ust as excise duty is a tax on value addition on goods, service tax is on value addition by rendition of services. Therefore, for our understanding, broadly "services" fall into two categories, namely, property based services and performance based services. Property based services cover service providers such as architects, interior designers, real estate agents, construction services, mandapwalas etc. Performance based services are services provided by service providers like stock-brokers, practising chartered accountants, practising cost accountants, security agencies, tour operators, event managers, travel agents etc." (ii) In the case of Coca Cola India Pvt. Ltd. v. Commissioner of C. Ex., 2009 (15) S.T.R. 657 (Bom.) = 2009 (242) E.L.T. 168 (Bom.), the Bombay High Court was examining whether services of advertising and marketing procured by the appellant Coca Cola India Limited in respect of advertisement for aerated waters are covered by the definition of 'input service' in Rule 2(l) of the Cenvat Credit Rules, 2004. The High Court noticed that the definition is worded in the expression "means and includes". The Bench also put stress on the words "in relation to" manu....
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....ommissioner of C.Ex. v. Ultratech Cement Ltd., 2010 (20) S.T.R. 577 (Bom.) = 2010 (260) E.L.T. 369 (Bom.) the Bombay High Court was considering the question whether outdoor catering service provided by the employer can be covered under the definition of input service. In that context, it was held and observed as under : "28. In the present case, the question is, whether outdoor catering services are covered under the inclusive part of the definition of "input service". The services covered under the inclusive part of the definition of input service are services which are rendered prior to the commencement of manufacturing activity (such as services for setting up, modernization, renovation or repairs of a factory) as well as services rendered after the manufacture of final products (such as advertisement, sales promotion, market research etc.) and includes services rendered in relation to business such as auditing, financing.... etc. Thus, the substantive part of the definition "input service" covers services used directly or indirectly in or in relation to the manufacture of final products, whereas the inclusive part of the definition of "input service" covers variou....
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....port of goods by road and issues consignment note, by whatever name called." 13. Section 3 of the Central Excise Act, 1944 provides for the levy of duties specified in the schedules to the Central Excise Tariff Act. Section 4 of the Central Excise Act, 1944 pertains to valuation of excisable goods for purposes of charging of duty on excise. Clause (c) of sub-section (3) of Section 4 defines the term "place of removal" as follows : "(c) "place of removal" means - (i) a factory or any other place or premises of production or manufacture of the excisable goods (ii) a warehouse or any other place or premises wherein the excisable goods have been permitted to be deposited without payment of duty; (iii) a depot, premises of a consignment agent or any other place or premises from where the excisable goods are to be sold after their clearance from the factory from where such goods are removed." Rule 2 of Cenvat Credit Rules defines several terms used in the Rules including the term "input service" as under : l. "Input service" means any service - (i) used by a provider of taxable service for providing an output service, or ....
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....s and sometimes means and includes; each having different connotation, different purpose and different meaning to be conveyed. 17. It is by now well settled that when a word is defined to mean such and such, the definition is, prima facie, restrictive, whereas where the word is defined to include something, the definition is prima facie expansive. On the other hand, when the Legislature uses the expression 'means and includes', the definition is meant to be exhaustive. Such principles, however, are subject to exceptions. 17.1 In the case of V.F. & G. Insurance Co. v. M/s. Fraser & Ross, AIR 1960 SC 971, the Apex Court observed that when expression "means" is used, generally the definition is exhaustive. 17.2 In the case of State of Bombay v. Hospital Mazdoor Sabha, AIR 1960 SC 610, it was observed that "it is obvious that the words used in an inclusive definition denote extension and cannot be treated as restricted in any sense" "Where we are dealing with an inclusive definition it would be inappropriate to put a restrictive interpretation upon terms of wider denotation". 17.3 In the case of Ramanlal Bhailal Patel v. State of Gujarat, AIR 2008 SC 1246 the Apex Court fou....
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....xpressions." (See : Dilworth v. Commissioner of Stamps, 1899 AC 99 at pp. 105-106 (Lord Watson); Mahalakshmi Oil Mills v. State of Andhra Pradesh, (1989) 1 SCC 164, at p. 169 : (A.I.R. 1989 S.C. 335 at p. 339). The use of the words 'means and includes' in Rule 2(b) would, therefore, suggest that the definition of "college" is intended to be exhaustive and not extensive and would cover only the educational institutions falling in the categories specified in Rule 2(b) and other educational institutions are not comprehended." 17.6 In the case of M/s. Black Diamond Beverages v. Commercial Tax Officer, Calcutta, AIR 1997 SC 3550, wherein, interpreting the definition of 'sale price' the Apex Court observed as under : "7. It is clear that the definition of 'sale price' in Section 2(d) uses the words 'means' and 'includes'. The first part of the definition defines the meaning of the word 'sale price' and must, in our view, be given its ordinary, popular or natural meaning. The interpretation thereof is in no way controlled or affected by the second part which 'includes' certain other things in the definition. This is a well-settled principle of construction. Craies on Statute L....
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....on to the owner. The words "or any person for the time being in charge of such vehicle or responsible for the management of the place of business of such owner" indicate that the permit holder will include any person who is in charge of such vehicle of the permit holder or any person who is responsible for the management of the place of business of such owner. The owner cannot escape the liability by stating that any person is for the time being in charge of such vehicles, and, therefore, such person is the owner and not the permit holder. 20. The general rule of construction is not only to look at the words but to look at the context, the collocation and the object of such words relating to such matter and interpret the meaning according to what would appear to be the meaning intended to be conveyed by the use of the words under the circumstances. Sometimes definition clauses create qualification by expressions like "unless the context otherwise require"; or "unless the contrary intention appears"; or "if not inconsistent with the context or subject-matter". "Parliament would legislate to little purpose", said Lord Macnaghten in Netherseal Co. v. Bourne, (1889) 14 AC 228,....
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....tivity from the main body of the definition if it is otherwise covered by the expression 'means'. In other words, the expression 'includes' followed by 'means' in any definition is generally understood to be expanding the definition of the term to make it exhaustive, but in no manner can the expression 'includes' be utilized to limit the scope of definition provided in the main body of the definition. To our mind this was also not the intention of the Legislature in the present case. 20. There, of course, are certain areas which still remain to be cleared. It was vehemently contended before us by the counsel for the Revenue that later portion of the definition which provides for the inclusion clause limits the outward transportation service up to the place of removal. That being so, according to them, the outward transport service utilized by the manufacturer beyond the place of removal would not qualify as an input service within the definition of Rule 2(l). We may only notice two things in this regard. Firstly, in our view, when we find that outward transport service is covered by the main body of the definition which provides for means part, as specifically including any serv....