TaxTMI 
TaxTMI 
2017 (2) TMI 715
X X X X Extracts X X X X
X X X X Extracts X X X X
....eciation, we reproduced the conclusive portion of the said order:- "11. We have considered the rival contentions and perused the records. There is no dispute of fact between the parties. Undisputedly, Renusagar Power Plant is supplying the entire power production to the appellant company. Undisputedly, the insurance policies cover only loss to the plant and none of the employees. 12. From the above submissions made on behalf of the respective parties, it is obvious that the main dispute in this case whether or not Renusagar Power Plant is captive plant of appellant company. Captive plant has not been defined in the Act or rules. However, by the terminology used, it obviously means power generation plant supply only to the parent company. 'Captive generating plant' is defined under Section 2(8) of Electricity Act, 2003 which reads: "Captive generating plant" means a power plant set up by any person to generate electricity primarily for its own use and includes a power plant set up by any cooperative society or association of persons for generating electricity primarily for use of members of such co-operative society or association. This definition also states that capt....
X X X X Extracts X X X X
X X X X Extracts X X X X
....J), which involves the question of availability of credit of service tax to the Appellants on that part of the insurance premium, which relates to insurance coverage of the power plant belonging to Renu Sager Power Company Limited, a subsidiary of Hindalco Industries Limited. 2. The order proposes to allow credit by quoting Paras 11 to 14 from an earlier order No. 561/2011-EX (BR) dated 07.05.2012 passed by this Tribunal in the matter of the Appellants themselves. The said order dated 07.05.2012, in absence of definition of captive plant, borrowed the definition of generating plant' given under Section 2(8) of the Electricity Act, 2003 and goes on to hold that there being no dispute that power generated by Renusagar Power Plant was exclusively supplied to the appellant company. In the previous Paras of the said order dated 07.05.2012 a reference was also made to the judgment of the Hon'ble Supreme Court In the matter of State of UP and ors. v. Renusagar Power Company and others (involving question of levy of electricity duty on power generated by Renusagar Power Company Limited) as reported in AIR 1988 SC 1737. The said order dated 07.05.2012 also relied upon the ratio of the ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....t of Renusagar is located about 50 Kms. away from Hindalco's plant though power is supplied to Hindalco and their some other facilities like residential colony etc. 7. So far as the Cenvat Credit Rules are concerned, they do not contain any provision for allowing credit of Service tax to a holding company in respect of the services availed of by a subsidiary company. There is nothing to this effect in the submissions made by the Appellants while canvassing their case for availability of credit. In my opinion, it is a fundamental proposition that the relevant law should be taken into consideration as the first step to decide an issue. The role of precedent is to support the proposition of law. In the absence of specific provision permitting availability of credit to a holding company for the services received by a subsidiary, I do not subscribe to the view that credit can be allowed by extending the logic underlying the judgment in other cases rendered in a different context. 8. It may be relevant to point out here that the facility of availability of input credit in respect of the captive power plant was extended effective from dated 01.4.2012 by amending the Cenv....
X X X X Extracts X X X X
X X X X Extracts X X X X
....basis of the said order. Vikram Cements v. CCE, Indore 12. In this matter, the Hon'ble Supreme Court dealt with the issue of availability of credit to Vikram Cements on the capital goods used in the mines located in the proximity of the manufacturing unit. While remanding the matter, the Hon'ble Supreme Court observes as under: "5. As regards the Modvat/ Cenvat credit on capital goods, if the mines are captive mines so that they constitute one integrated unit together with the concerned cement factory, Modvat/ Cenvat credit on capital goods will be available to the assesse. On the other hand, if the mines are not captive mines but they supply to various other cement companies of different assesses, Modvat/ Cenvat credit on capita/ goods used in such mines will not be available to the concerned assesse under the appropriate Modvat/ Cenvat Rules. The matters are remanded to the respective original authorities for decision only on the above issue. "(Emphasis supplied) 13. Thus, to attract the ratio of this judgment, the mines not only should be captive ones but should also constitute 'one integrated unit together with the concerned cement factory'. In the present....
X X X X Extracts X X X X
X X X X Extracts X X X X
....fference of Opinion Whether appellant is entitled to credit of duty paid on inputs and input services utilized at their power plants situated out side the factory but considered as captive power plant based on Tribunal's earlier judgement in the case of same party i.e. M/s Hindalco Industries Ltd. as held by Member (Judicial). OR Whether appellant credit of duty paid on inputs or input services utilized at power plant situated outside the factory but not considered as captive power plant of independent power plant of the same company, will not be available as per analysis of various judgement as held by Member (Technical). (Manmohan Singh) Member (Technical) (Archana Wadhwa) Member (Judicial) Per: B. Ravichandran: These bunch of appeals deal with the same issue and hence were taken up for decision together. The subject matter of decision was whether the appellant is entitled to cenvat credit of duty paid on various input services utilised for their power generation plant located at Renusagar about 50 km. away from the manufacturing plant. When the matter came up for decision before the Division Bench, there was a difference of opinion between Member (Ju....
X X X X Extracts X X X X
X X X X Extracts X X X X
....e the position amply clear. Hon'ble Bombay High Court vide order dated 22.04.1993 in company Petition No. 128 of 1993 approved the scheme of amalgamation which resulted in the merger of Hindalco Industries Limited and Renusagar Power Company Limited. As such there can be no dispute about the fact that power plant at Renusagar belonging to the appellant. Hence, the basis of Member (Technical)finding that the power plant belongs to subsidiary unit is factually incorrect. Hence, the reasoning followed is untenable. 7. Considering the other aspects regarding appellant's eligibility for input service credits, it is noted that neither the impugned orders nor the show cause notices have disputed the services in question for their eligibility and coverage under Cenvat Credit Rules, 2004. Credit of input service is with reference to manufacturer, not with reference to factory. Hon'ble Bombay High Court's decision in Deepak Fertilizers & Petrochemicals Corporation Ltd. - 2013 (32) STR 532 (Bom.) is relevant in this regard. The High Court allowed credit on services received for erection & commissioning of storage tank situated outside the factory of production. Tribunal....