2016 (1) TMI 593

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.... of such service tax paid. Revenue authorities are of the view that the credit so availed is incorrect and needs to be reversed. Show cause notices were issued for the demand of such CENVAT credit along with interest and also for imposing penalties. The adjudicating authority after following due process of law confirmed the demands raised with interest and also imposed penalties. 3. Learned senior counsel shri Arshad Hidyatullah appearing on behalf of the appellant, along with advocate M. Joshi submits that the issue is no more res integra. He would draw our attention to the order-in-original, more specifically to the findings portion and submit that it is undisputed that the activity of maintenance and repairs was undertaken at the windmill farm at Satara. He would submit that the electricity which is fed into MSEB grid is drawn for the manufacturing activity, would mean electricity so generated is consumed for the manufacturing activity and the services rendered by the service provider and the service tax paid there on, CENVAT credit can be availed. He relies upon the judgment of the Honble High Court of Bombay in the case of Commissioner of Central Excise and Customs, Aurangab....

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....rties are similar. 2] The appellant is challenging judgment and order passed by Central Excise Service Tax Appellate Tribunal [CESTAT for short]. The substantial questions that arise for our consideration and which are indentified earlier are as under: I] Whether the CESTAT is correct in holding that the assessee is entitled to avail the CESTAT credit on "management, maintenance or repair services" provided on services provided to Windmills installed and situated away from factory and factory premises? II] Whether electricity generated at Supa and Satara, situated for away, could be said to have been used for manufacture of the final product of the assessee at Waluj, Aurangabad. 3] The question No.[II] can be answered in affirmative because admittedly, the electricity generated at Supa and Satara which are situated for away from the manufacturing unit of the appellant can be said to have used for manufacture of final product at Waluj, Aurangabad. Mainly because admittedly such electricity generated at Supa and Satara is adjusted to the electricity used at Waluj. This adjustment is admitted by the revenue and in view of this adjustment, it can safely be stated that the elect....

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....from 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. (m) "input service distributor" means an office of the manufacturer or producer of final products or provider of output service, which receives invoices issued under rule 4A of the Service Tax Rules 1994 towards purchases of input services and issues invoice, bill or, as the case may be, challan for the purposes of distributing the credit of service tax paid on the said services to such manufacturer or producer or provider, as the case may be. Rule 3. CENVAT Credit : (1) A manufacturer or producer of final products or a provider of taxable service shall be al....

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....ce received by manufacture of final product would be susceptible to CENVAT credit. Rule does not say that input service received by a manufacturer must be received at the factory premises. The judgments referred to above, also interpret the word "input" service in similar fashion. In the case of Commissioner of Central Excise, Nagpur Versus Ultratech Cement Ltd. [cited supra], the Division Bench of this Court held that the definition of "input service" is very wide and covers not only services which are directly or indirectly used in or in relation to manufacture of final product but also includes various services used in relation to business of manufacture of final product. The expression "activities" in relation to business is also discussed in this judgment by referring to judgment of Apex Court. In the case of Deepak Fertilizers & Petrochemicals Corporation Ltd. Versus C.C.Ex.Belapur [cited supra] the Division Bench held as under: "The definition of the expression 'input service' covers any services used by the manufacturer, whether directly or indirectly, in or in relation to the manufacture of final products. The words 'directly or indirectly' and 'i....