2017 (9) TMI 292

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....ge that there was no nexus between these services and output service. He argued that the show-cause notice in respect of credit of service tax on aircraft hiring charges was solely based on the definition of input service as amended vide Notification No.03/2011-CE(NT) dated 01/03/2011. The said definition, which reads as follows: "input service means any service, - i) used by a provider of taxable service for providing an output service; or ii) used by a manufacturer, whether directly or indirectly, in or in relation to the manufacture of final products and clearance of final products upto the place of removal and includes services used in relation to modernization, renovation or repairs of a factory, premises of provid....

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....em have been denied on the ground that there is no nexus, though the show-cause notice did not allege the same. He pointed out that show-cause notice in this case was solely based on interpretation of Rule 5 of the Taxation of Services, however, (provided from outside in the India and received in India) Rules, 2006. The said rule reads as under: "Rule 5 "The taxable services provided from outside India and received in India shall not be treated as output services for the purpose of availing credit of duty of excise paid on any input or service tax paid on any input services under CENVAT Credit Rules, 2004". 2.3 He pointed out that the said rule does not prohibit the appellants from availing Cenvat Credit of the service tax paid by the....

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....ervice provider and such circumstances, credit reversal cannot be sought from ISD. Ld. AR pointed out that during investigation in the case of evidence of use of aircraft for the official purpose was sought but the same was not provided. He further admitted that the said assertion does not find any place in the show-cause notice. He further argued that notice has been issued to ISMT Ltd., which is a local person and therefore, it implies both the manufacturers as well as ISD, were issued notice. 4. I have gone through the Rival submissions. I find that the show-cause notice for demand was issued on the limited issues. In respect of the service tax credit of aircraft hiring charges, the show-cause notice relies on the exclusion clause (b)....