TaxTMI 
TaxTMI 
2018 (1) TMI 1215
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....e construction of the hotel building, the appellant availed various input services such as that rendered by civil contractors, architects and project management services. They availed credit of the service tax paid on these services. They had obtained service tax registration under the category of Cab operator s service, Health club and fitness service, Internet cafi service and Dry cleaning service etc., w.e.f. 22.05.2008. That, appellants were rendering the above taxable services w.e.f. 22.0-5.2008 and started rendering hotel services/Short term accommodation services and Restaurant services w.e.f. February 2009. Out of the above taxable services, the short term accommodation service and restaurant service became taxable only w.e.f. 01.05.2011. Thus, for the disputed period 2008 -09 to 2011-12 the appellant was rendering both taxable and non-taxable services. The allegation of the department that the appellant has wrongly availed Cenvat credit on Construction services is in correct. ii) Rule 6 (5) provides that an assessee can avail input service credit of common input services if they are not exclusively used for exempted services. For example:- the Project management s....
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....sation with regard to the services mentioned in Notification only. It does not impose any condition that the service provider shall not avail Cenvat credit on any of the services procured for providing all other output services. That the department has denied the credit as well as abatement on wrong interpretation of the said notification. iv) To support his contentions, he relied upon the decisions laid down by the Tribunal as under:- a) Tidel Park Ltd. Vs. CST, Chennai - 2010 (18) STR 642 (Tri.-Chen.) b) CCE, Goa Vs. Asia Pacific Hotels Ltd. - 2013- TIOL-1078-CESTAT-Mumbai c) CCE, Goa Vs. V.M. Salgoankar Bros. - 2008 (10) STR 609 (Tri.-Mum.) The Ld. Counsel submitted that in the appellant's own case M/s. Lemon Tree Hotel (Cybel Hill Developers Pvt Ltd., M/s. Fleur Hotels Pvt. Ltd. Vs. CC & CE, Hyderabad - 2017 (7) TMI-CESTAT-HYDERABAD), the Tribunal on similar issue had decided in favour of the appellants. That the Commissioner (Appeals) for a different period had allowed the credit as well as abatement in the appellant s own case, which was considered by the Pune Commissionerate. That the decision in the case of Bharat Heavy Elect....
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....ternet cafi service and dry cleaning service. The input service credit was availed by appellant on construction services which were used for setting up of the premises from where the output services were rendered by the appellant. The department does not have a case that the above services were not rendered from the building constructed by the appellant for which the credit on construction activities was availed. Rule 6 (5) as it stood during the relevant period states that credit is eligible on the services specified therein, if such services are not used exclusively for exempted services. Even if we consider that prior to 01.05.2011, the output services of short term accommodation services and restaurant services were not taxable services, the appellants were rendering other taxable services like health club and fitness service, internet cafi service etc. Since the services specified in Rule 6 (5) were not used by the appellant exclusively for non-taxable services, the appellants are eligible for the credit. The said Rule starts with a non-obstante clause wherein it is stated that notwithstanding anything contained in Rule 6 (1), (2) and(3), the assessee will be eligible for cred....
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....that this notification shall not apply in cases where,- (i) the Cenvat credit of duty on inputs or capital goods or the Cenvat credit of service tax on input services used for providing such taxable service, has been taken under the provisions of the Cenvat Credit Rules, 2004;" 5.4 We find merit in this argument. During the disputed period (March 2011 -2012 for this demand) the appellant has not availed any credit of input services used for providing Short term accommodation services and Restaurant services. The credit already availed in 2009 was used to discharge the service tax liability. The Notification No. 1/2006-ST does not say that assessee cannot avail any credit at all. The condition is that the abatement would be available only if input service credit is not availed on input services used for providing such services specified in column 2 of the notification. In the appellant's own case reported as 2017 (7) TMI 799 (CESTAT-Hyderabad), the co-ordinate Bench of the Tribunal at Hyderabad had considered the very same issue on identical facts by relying upon the judgment of the Hon'ble High Court of Gujarat in the case of Mundra Ports and Special Economic Zone L....
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....d the clarification given by the Board in CBEC Circular dated 04.01.2008 is going beyond the definition as reproduced is herein above. We find that similar issue as to eligibility to avail the CENVAT credit on design and engineering of pipe line, services rendered by the pipeline laying of contractors, was denied in the case of Reliance Gas Transportation Infrastructure Ltd., (supra), holding that these services were utilized for brining into existence an immovable property. The Bench after considering the definition of input services, held that the provisions of Section 2(l) of the CENVAT Credit Rules, 2004 very clearly indicate eligibility to avail CENVAT credit of the service tax paid on these services. 8. Views of the Tribunal have been fortified by decision of the Honble High Court of Gujarat in the case of Mundra Ports and Special Economic Zone Ltd., (supra) the ratio is in paragraph No. 7, 8 & 9 which we with respect reproduce:- 7. It is not disputed that jetty was constructed and input credit was claimed on cement and steel. The aforesaid definition of Rule 2(k) was applicable and Explanation 2 did not provide that cement and steel would not be eligible fo....
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....nch of the Andhra Pradesh High Court squarely applies to the facts of the case and answered the question on which the appeal has been admitted. 8.Mr. Y.N. Ravani, learned counsel for the Revenue has placed reliance on the decision of the Larger Bench of the Tribunal in Vandana Global Limited v. Commissioner of Central Excise, Raipur, 2010 (253) E.L.T. 440. We have carefully gone through the decision of the Larger Bench of the Tribunal. We do not find that amendment made in Cenvat Credit Rules, 2004 which come into force on 7-7-2009 was clarificatory amendment as there is nothing to suggest in the Amending Act that amendment made in Explanation 2 was clarificatory in nature. Wherever the Legislature wants to clarify the provision, it clearly mentions intention in the notification itself and seeks to clarify existing provision. Even, if the new provision is added then it will be new amendment and cannot be treated to be clarification of particular thing or goods and/or input and as such, the amendment could operate only prospectively. In our opinion, the view taken by the Tribunal is based on conjectures and surmises as the Larger Bench of the Tribunal used the expression th....
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....lies to case where CENVAT credit is taken either on the input or input service , then the abatement under the aforesaid Notifications would not be available. In a case where the CENVAT credit on input/input service is not taken then the benefit of abatement would be available. The Notification uses the expression in cases where . In other words, the Notification does not stipulate that in all cases, the condition of non-availment of CENVAT credit should be satisfied uniformly without exception. Therefore, in respect of a contract where the assessee has not taken input credit prior to 1-3-2006 and input/input service tax credit on or after 1-3-2006, the assessee would be rightly entitled for the benefit under the Notification No. 15/2004-S.T. as replaced by Notification No. 1/2006, dated 1-3-2006. In a case where the assessee avails CENVAT credit, then in such cases the assessee is not entitled for abatement and the service tax liability will have to be discharged on the full value of the contract. There is nothing in these Notifications which prevents an assessee from not availing CENVAT credit and paying service tax on 100% of the contract value in respect of one particular contra....