TaxTMI 
TaxTMI 
2019 (5) TMI 372
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.... adjudication, the demand was confirmed with interest and penalty. Hence, the present appeal. 3. The learned Advocate for the appellant has submitted that during the period in dispute the appellant had constructed a mall, which was let out subsequently on commercial basis and the appellants were discharging Service Tax under the taxable category of Renting of Immovable Property Service from time to time. The construction of the said mall was completed in phased manner during August, 2007 to January, 2008. The premises were given on rent from January, 2008 and onwards. The show-cause notice was issued to the appellant for recovery of a total CENVAT Credit of Rs. 9,40,38,326/- proposing to deny CENVAT Credit of excise duty/CVD paid on various capital goods used in the construction of mall amounting to Rs. 1,70,52,345/-, input services used in construction of mall before 1.6.2007 amounting to Rs. 1,95,75,038/-, in respect of input services used in construction of Mall after 01.6.2007 amounting to Rs. 4,14,11,353/-, input services used in rendering output service of Renting of Immovable Property Service prior to 1.6.2007 amounting to Rs. 13,44,039/- and on input services used to prov....
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....ion of this Tribunal in the case of Navaratna S.G. Highway Prop. Pvt. Ltd. - 2012 (28) STR 166 (Tri- Ahd.), Vamona Developers Pvt. Ltd. - 2016 (42) STR 277 (Tri-Mum), Oberoi Mall Ltd. - 2017 (47) STR 292 (Tri-Mum), City Centre Mall Nashik Pvt. Ltd. - 2017-TIOL-4322-CESTAT-MUM. 6. Assailing the findings of the adjudicating authority, the learned Advocate has further submitted that there has been nexus between the input services received by the appellant for operation of the mall and the output service of rendering of immovable property service provided by them. The learned Advocate has further submitted that even though it has been alleged in the show-cause notice that the appellant has suppressed the facts but there is no evidence placed on record that the appellant has suppressed facts with intent to evade payment of tax. It is their contention all the facts relating to availing of Credit when asked by the department pursuant to the scrutiny of ST-3 Returns filed from time to time, they have intimated the same through their letter dated 01.4.2010 to the department. Besides, the present issue also relates to one of interpretation of definition of the term 'input services' and 'ca....
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....eferring to the judgment in the case of Tower Vision India Pvt. Ltd. Vs. Commissioner of Central Excise, Delhi - 2016 (42) STR 249 (LB) the learned AR has submitted that CENVAT Credit cannot be allowed if MS Angles and Channels have gone into fabrication of such tower, which are in turn used for providing infra support service of telecom services. Further, referring to the judgment of Sai Sahmita Storages Pvt. Ltd. - 2011 (23) STR 341 (AP), Navratna SG Highway (supra), Mundra Port SEZ (supra) relied upon by the appellant, the learned AR for the Revenue submitted that the ratio laid down in the said judgments are inapplicable in the facts of the present case. 9. On the aspect of limitation, the learned AR for the Revenue has submitted that appellant failed to inform about availing of CENVAT Credit, at any stage, during the construction of Mall or thereafter also in the ST-3 returns, they have not disclosed the said transaction and failed to pay Service Tax. Accordingly, the extended period of limitation is applicable. 10. Heard both sides at length and perused the records. 11. The issue involved for determination in the present appeal is: whether the appellants are eligible to....
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....een held that there is nexus between the input services received by the appellant for setting up and operation of the mall in providing the output service of renting of immovable property. 13. Revenue, on the other hand, tried to distinguish the aforesaid judgments submitting that the ratio laid down in Bharati Airtel's case would be squarely applicable, hence, CENVAT Credit on the input services used in the construction of the mall and thereafter management, maintenance and repair of the same would not be applicable. 14. We find that this Tribunal in more or less identical circumstances, in the case of City Centre Mall Nashik Pvt. Ltd's case confronted with denial of CENVAT Credit involving the period October, 2007 to March, 2012, and the disputed credit d amount has been categorized in para 2 of the said judgment as follows: - "(A) Demand of Cenvat Credit of Rs. 5,46,82,044/- (March 2007 to March 2011. A.1. Credit on Cement, Steel, TMT Bars, Doors, Windows etc. used for construction of mall under the category of input amounting to Rs. 1,63,67,075/-. A.2. Capital goods used in the mall such as Lift, Escalator, Chillers, D.G. Sets, Heat Exchangers, Wires, Cables, Fire ....
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....ruction of building/structure is not admissible. We therefore uphold the demand of service tax amounting to Rs. 1,63,67,075/-. As regard the cenvatcredit availed amounting to Rs. 2,26,36,646/- on the capital goods, we find that all the capital goods fall under the definition of capital goods provided under cenvat credit rules 2004. The adjudicating authority denied the credit only on the ground that these capital goods after installation become immovable goods, therefore the credit is not admissible. We find that all the capital goods were cleared by the supplier on payment of duty therefore the capital goods as such can not be said that it is immovable goods. Merely by installing the capital goods it does not become an immovable goods. If this contention of the adjudicating authority is accepted then all the capital goods such as machinery, equipments, appliances installed in the factory for production will not be eligible for cenvat credit. Therefore merely by installation of duty paid capital goods, it can not be said that it is immovable goods all the capital goods were used in the shopping mall to facilitate the shop owners for operation of the mall, who have been given the sh....
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....s for taking Cenvat Credit as against the output service of the appellant i.e. renting of the said stadium and other services on which services, service tax was discharged. Whether the service is input service or otherwise, it can be ascertained only on the basis of definition of 'input service' as provider under Rule 2(l) of Cenvat Credit Rules, 2004, which is reproduced below: "Input Services- As per Rule 2(l) of Cenvat Credit Rules, 2004, (prior to 1.4.2011) '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 from the place of removal]1n, and includes services used in relation to setting up, modernisation, renovation or repairs of a factory, premises of provider of output service or an office relating to such factory or premises, advertisement or sales promotion, market research, storage upto the place of removal, procurement of inputs, activities relating to business, such as accounting, auditing, financing, recruitment and quality control, coachin....
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....ed for construction of immovable property which in turn used for renting and other services. The operative para is reproduced below:- "3.2 The definition of 'inputs' is limited to the definition of 'input services' as can be seen from the definition given above. Credit of duty paid on inputs is available when the inputs are used for providing an 'output service'. Therefore, there is a need to say that the inputs have been used for providing an 'output service'. In the case of 'input service', the definition includes input services used by a provider of taxable service for providing an output service. Therefore the definition of input and input service are parimateria as far as the service providers are concerned. That being the position, the decision of the Hon'ble High Court of Andhra Pradesh would be applicable to the present case. In that case also, the Hon'ble High Court took the view that without use of cement and TMT bars for construction of warehouse assessee could not have provided 'storage and warehousing service'. In this case also, without utilizing the service, mall could not have been constructed and therefore ....
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....e assessee by recording as under: "3.2 The definition of inputs' is limited to the definition of input services' as can be seen from the definition given above. Credit of duty paid on inputs is available when the inputs are used for providing an output service'. Therefore, there is a need to say that the inputs have been used for providing an output service'. In the case of input service' the definition includes input services used by a provider of taxable service for providing an output service. Therefore the definitions of input and input service are pari-materia as far as the service providers are concerned. That being the position, the decision of the Hon'ble High Court of Andhra Pradesh would be applicable to the present case. In that case also, the Hon'ble High Court took the view that without use of cement and TMT bars for construction of warehouse assessee could not have provided storage and warehousing service'. In this case also, without utilizing the service, mall could not have been constructed and therefore the renting of immovable property would not have been possible. The issue involved is squarely covered by the decision of the Hon....
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....filed an appeal against this judgement, we are bound by judicial discipline to honor the judgment of the High Court. ............................................................................................... 7. It is obvious from the definition of input service as it stood prior to 11.4.2011 and after 1.4.2011 that, in the earlier period there was no restriction on use of the input service for construction of building or civil structure used for providing output service. Reliance on the case of Bharti Airtel Ltd. (supra) is misplaced. First, the Honble High Court clearly held that their conclusion is based on the facts and circumstances which fell for their consideration in those appeals. Secondly, because in that case the input services/inputs were used in construction of towers which were held to be immoveable property and hence not excisable. And credit was sought on structural items such as iron and steel. Similarly even the judgement in case of Vodafone does not help the Revenue. In the present case, we find that almost the entire credit has been availed on input services which have been used for providing the output service that is Renting of Immoveable Property Serv....