TaxTMI 
TaxTMI 
2014 (10) TMI 676
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....disputed services are confirming to the definition of 'input service' as contained in Rule 2(l) of the Cenvat Credit Rules, 2004.The reasons assigned in the impugned order for disallowance of Cenvat credit are that the utilization of services in various offices located at different places away from the factory have no impact on the quality and efficiency of the manufacturing activity and with regard to some of the disputed services, no documents have been produced to demonstrate as to how the services are related to the business of manufacture. Thus, according to the impugned order, the disputed services are neither meeting the essential requirement contained in the main part nor in the inclusive part of definition of 'input service'. 2. In the grounds of appeal, the appellant had stated the nature, purpose and use of the disputed services and their nexus with the business of manufacture of final product, which are indicated herein below:- (i) Air Travel Service: The air travel charges were paid for business trips undertaken by the company officials/ guests for various business related purposes viz., negotiation of orders, visiting the customer's place/ supplier's f....
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....ture and not exhaustive and merely gives an indication as to what are the activities, that will normally meet the requirements of the phrase 'activity relating to business'. According to the learned Advocate, merely because some of the activities relating to business are specified in the definition and majority of other business related activities are not specified therein, does not mean that other activities relating to business would not come within the ambit of definition of "input service". To substantiate the stand that the disputed services are falling within the scope and ambit of 'input service', the learned Advocate has relied on various authoritative decisions rendered by the judicial forums, which are discussed in the following paragraphs. 3. The learned A.R. appearing for the Revenue has reiterated the findings recorded in the impugned order and further submitted that an assessee is entitled to take Cenvat credit only on those input services, which have been listed specifically in the definition clause provided in Rule 2(l) of the rules and not otherwise. 4. I have heard the learned counsel for the parties and perused the record. Rule 2(l) of the Cenva....
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....anufacture of final products but also services relating to the business such as accounting, auditing..... etc. Thus the definition of input service seeks to cover every conceivable service used in the business of manufacturing the final products. Moreover, the categories of services enumerated after the expression 'such as' in the definition of 'input service' do not relate to any particular class or category of services, but refer to variety of services used in the business of manufacturing the final products. There is nothing in the definition of 'input service' to suggest that the Legislature intended to define that expression restrictively. Therefore, in the absence of any intention of the Legislature to restrict the definition of 'input service' to any particular class or category of services used in the business, it would be reasonable to construe that the expression 'such as' in the inclusive part of the definition of input service is only illustrative and not exhaustive. Accordingly, we hold that all services used in relation to the business of manufacturing the final product are covered under the definition of 'input service' and in the present case, the outdoor catering s....
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....The Hon'ble Bombay High Court in the case of Coca Cola India Pvt. Ltd. - Vs. - Commissioner of Central Excise, Pune - III [2009 (242) ELT 168 (Bom.)], while conveying the true meaning of the phrase 'activities relating to business' in background of the rules, has held as follows :- 26. The definition of input service employs the phrase activity relating to business. The words relating to further widens the scope of the expression activities relating to business. This is in view of following observations of Supreme Court in Doypack Systems (P) Limited v. Union of India - 1988 (36) 201 (S.C.), interpreting the expression in relation to : 48. The expression in relation to (so also pertaining to), is a very broad expression which pre-supposes another subject matter. These are words of comprehensiveness which might both have a direct significance as well as an indirect significance depending on the context, see State Wakf Board v. Abdul Aziz (A.I.R. 1968 Madras 79, 81 paragraphs 8 and 10, following and approving....
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.... manufacture, and thus, confirming to the expression 'activities relating to business' as contained in the definition clause of 'input service'; as the word 'business' is one of wide import and in fiscal statutes, it must be construed in a broad rather than a restricted sense. For example, the air travel service is no way connected to the manufacture of final product, yet the service tax paid on that service will qualify as 'input service', because the expenditure on that head of service is commercially required for the purpose of carrying on the business. In this context, it has been held by this Tribunal in the case of CCE - Vs. - Fine Care Biosystems, reported in 2009 (16) STR 701 (Tri. - Ahmd.) that where air travel is performed for purpose of company business, credit on the charges for said service is admissible. Further, consequent upon amendment of the Cenvat Credit Rules, 2004 (w.e.f. 01.04.2011), the CBEC vide Circular No. 943/2011 - CX., dated 29.04.2011 had clarified certain queries raised by the trade and industry, the relevant portions are extracted below:- 2. Is the credit of only specified goods and services listed in the definition ....