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TaxTMI 
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2018 (6) TMI 636
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.... original authority confirmed the demand, interest and imposed penalties. In appeal, Commissioner (Appeals) upheld the same. Hence this appeal. 2. On behalf of the appellant, ld. counsel Shri V. Raghuraman submitted that the office at Mumbai operates as procurement / marketing office for the appellant since all the orders for manufacturing unit are procured by their Mumbai office. The appellants have only one manufacturing unit which is located at Hosur and their office at Mumbai procures the orders which is essential for the purpose of receiving orders from various pharmaceutical companies. All these activities done at the Mumbai office are either directly or indirectly in or in relation to manufacturing activity carried out at Hosur fact....
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....aid on rentals paid on premises outside the manufacturing premise was held to be eligible. In Thiru Arooran Sugars Ltd. Vs. Commissioner of Central Excise, Puducherry - 2017 (51) STR 25, this Bench had allowed the credit of service tax paid on godown which was used for storing of goods outside the factory. The case of Deepak Fertilizers & Petrochemicals Corpn. Ltd. Vs. Commissioner of Central Excise, Belapur - 2013 (32) STR 532 (Bom.) was relied by the ld. counsel to explain that even if the services are not received within the factory, the same would be eligible for credit. To explain, there is no restriction with regard to input services that the services have to be availed within the factory. The ld. counsel also argued on the ground of ....
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....that renting of immovable property service relating only to the office of the factory could be eligible for such credit and that the said service was utilised beyond the place of removal and hence credit in respect thereof is not admissible. We find that the adjudicating authority has not dealt with the contention of the appellant that the branch offices which were taken on rent were used not only for procuring orders and delivery of the goods but also for provision of erection commissioning and installation service and repair and maintenance service. The definition of input service prior to 1-3-2011 and after 1-3-2011 as given in Rule 2(l) of Cenvat Credit Rules which is reproduced below : Prior to 1-3-2011 "Input service " means any ser....
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....financing, recruitment and quality control, coaching and training, computer networking, credit rating, share registry, security, business, exhibition, legal services, inward transportation of inputs or capital goods and outward transportation upto the place of removal; but excludes services, - (A) specified in sub-clauses (p), (zn), (zzl), (zzm), (zzq), (zzzh) and (zzzza) of clause (105) of Section 65 of the Finance Act (hereinafter referred as specified services), insofar as they are used for - (a) Construction of a building or a civil structure or a part thereof; or (b) Laying of foundation or making of structures for support of capital goods, except for the provision of one or more of the specified services; or (B) Specified i....
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....rly untenable specially when the other ground pleaded by the appellant that the branch offices were also used for provision of ECIS and repair and maintenance service has not been adverted to by it. Thus, having regard to the nature of the use for which these branch offices were taken on rent, we are of the view that the said service clearly qualifies to be covered within the scope of input service as defined in Rule 2(l) of the Cenvat Credit Rules, 2004." 6. The Hon'ble High Court of Bombay in the case of Deepak Fertilizers and Petrochemicals Corpn. Ltd. (supra) had held that the assessee would be eligible for credit on the services used in relation to storage of inputs outside the factory. The relevant portion is reproduced as under:- "....
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....legislation has advisedly used a broad and comprehensive expression while defining the expression „input service‟. Rule 2(l) initially provides that input service means any services of the description falling in sub-clauses (i) and (ii). Rule 2(l) then provides an inclusive definition by enumerating certain specified services. Among those services are services pertaining to the procurement of inputs and inward transportation of inputs. The Tribunal, proceeded to interpret the inclusive part of the definition and held that the Legislature restricted the benefit of Cenvat credit for input services used in respect of inputs only to these two categories viz. for the procurement of inputs and for the inward transportation of inputs. ....