TaxTMI 
TaxTMI 
2013 (7) TMI 637
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.... coal during the course of generation of electricity which is non-excisable and exempted product. The appellant is clearing coal fly ash at zero value. M/s Shankar Singh Jodha is providing handling service to the appellant for handling of coal fly ash and charging service tax. The coal fly ash is not an excisable goods and handling of coal fly ash is also not an input service for the appellant which is not covered under the definition of Input services as defined under rule 2(l) of the Cenvat Credit Rules, 2004 as it is not used in or in relation to manufacture of final product or for providing of output service as there is no nexus with manufacture of final product and clearance of final product from the place of removal and for providing ....
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....roduction process. Thus the removal of fly ash from CPP is essential for carrying on the manufacturing process done by the appellant and the services incurred for removal of fly ash can safely be said to be used by the manufacturer in or in relation to manufacture of our final product. Thus the credit in respect of said service may please be allowed to the appellant as eligible Input Service under Rule 2(l) of the Cenvat Credit Rules, 2004, being directly eligible under the said definition. In this regard they relied upon the following decisions:- (a) Sanghi Industries Ltd. vs. Commissioner of Central Excise, Rajkot reported in 2009(236) E.L.T. 617 (Tri.- Ahmd.) (b) Hindalco Industries Ltd. vs. Commissioner of Central Excise, Allahaba....
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....rns filed with the department, further during the entire disputed period, the records of the appellant were audited by the various Audit teams of the department and no objection was raised on this point. The appellant was never questioned as to taking of such credit except the present show cause proceedings. Thus it cannot be said that the appellants have suppressed the information of taking of such credit with an intent to evade payment of duty. It is submitted that charge of suppression can be made out only when there is corresponding duty to disclose. In the present case the appellant was never obliged to divulge out information which as per belief of the appellant was already known to the department. It is submitted that mens rea is an ....
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....that though providing such handling services of coal fly ash may be a necessity for the captive power plant but to qualify as an input service, the essential condition of the law is that an input service should have been used in providing output service or used in or in relation to manufacture of finished goods. He rejected the appellant's plea that these services are part of business activity and without removing the coal fly ash from the captive power plant, the same cannot work on the ground that said coal fly ash is not excisable. As such, removal of the same cannot be held to be as cenvatable input service. Accordingly, he rejected the appeal. 4. After hearing both the sides I find that the issue required to be decided in the presen....
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.... the manufacturer is admissible if the final product is dutiable and therefore, in this case also the Cenvat credit of input services for overhauling of DG set is admissible. Accordingly, the appeal is allowed on the above terms. 5. Further in the case of Hindalco Industries Ltd. vs. C.C.E.,Allahabad - 2005 (12) STR 337 (Tri-Delhi), the Tribunal observed that the service tax credit paid on insurance premium of the captive power generation plant was held to be an admissible cenvatable service. 6. The Hon'ble Mumbai High Court in the case in the case of Coca Cola India Pvt. Ltd. vs. C.C.E., Pune II - 2009 (15) STR 657 (Mum.) held that any such service used in relation to manufacturing activity and relating to business are required to be....