TaxTMI 
TaxTMI 
2018 (2) TMI 1433
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....Commercial or Industrial Construction Service) during the period 2008-2009. It was found that portion of the premises at Papparambakkam for which the input service credit was availed was leased to another company viz; M/s Hanil Lear India Ltd for storage of their input material. The department was of the view that appellant has not used the input services, on which credit was availed, in or in relation to the manufacture of their finished products. SCN was issued proposing to deny the credit and also for imposing penalties. After due process of law, the original authority confirmed the demand, interest and imposed penalty. Aggrieved, the appellant is before the Tribunal. 2. On behalf of appellant, the Ld. Counsel, Sh. R. Parthasarathy argu....
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....edit alleging that the portion leased out to M/s Hanil Lear not being used for manufacture of finished product by appellant is not eligible for input service credit on Construction services. That appellants being both manufacturer and service provider, they are eligible for credit. That in any case, they had immediately reversed the credit and that there was no suppression of facts with intention to evade payment of duty and therefore the penalties may be set aside. The reliance placed by department on Circular No. 98.01.2008 dt 04.01.2008 is incorrect. The Ld.Counsel relied upon the decisions in the following cases. 1) Navaratna S. G Highway Property Pvt Ltd Vs CST - 2012(28)STR 166 (Tri- Ahmd) 2) Varun Industries Vs CCE & ST - 2017(49....
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....tion raised in SCN dt. 31.03.2010 is that appellants are not eligible for the input service credit availed on Commercial or Industrial Construction Service availed during the period 2008-2009. The appellants had leased out part of the building to M/s Hanil Lear for which they received rent and discharged service tax. The definition of input service as it stood during the material time is as under. "Rule 2 (e) defines the input service as under : "input service means any service,- (i) used by a provider of taxable service for providing an output service, or (ii) used by the 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 a....
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.... an immovable property, could be treated as input service for the output service namely renting of immovable property service under the Cenvat Credit Rules, 2004? Input credit of service tax can be taken only if the output is a service liable to service tax or a goods liable to excise duty. Since immovable property is neither service or goods as referred to above, input credit cannot be taken. 7. Needless to say, that Board Circular is not binding upon the Court. The input credit whether availed on capital goods, inputs or input services is accounted in a common pool of credit. While utilising credit it is not necessary that there should be one to one correlation. To be more specific, the Cenvat Credit Rules does not prohibit the ....
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....refully considered the submissions from both sides and perused the records. Rule 3(1) of the CENVAT Credit Rules permits credit to a manufacturer of final product or a service provider of taxable service. If a person manufactures only excisable goods, he is entitled to take credit of not only excise duties paid on capital goods and inputs but also additional duty of customs paid under the Customs Tariff Act in respect of imported inputs and capital goods and also service tax paid on the input services utilized in or in relation to the manufacture of the excisable goods. In other words, a manufacturer of excisable goods is entitled to use the credit from a common pool to which different categories of specified excise duties, customs duty and....