TaxTMI 
TaxTMI 
TaxTMI 
2019 (10) TMI 1104
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....rvices like Construction Service, Clearing and Forwarding Service, Real Estate Service, Architect Service, Cleaning Service (pest control), Goods Transport Agency Service, Insurance Service and Interior Decorator Service amounting to Rs. 1,55,29,302/- but these service claimed to have been used for providing the output telecommunication service did not appear to be input services admissible for availment of Cenvat Credit. The Appellant was, therefore, called upon the show cause with evidence as to why the aforesaid amount should not be demanded/ recovered from it under Rule 14 of the Cenvat Credit Rules 2004 2004 Rules. 3. The Appellant submitted a detailed reply to the aforesaid show cause notice pointing out that the Cenvat Credit had been rightly availed on the eight services mentioned in the show cause notice as these eight services were input services for the output telecommunication service. It was also stated that the demand was barred by time as the extended period of limitation was not applicable and no penalty could be imposed nor interest was chargeable. 4. The Adjudicating Authority, however, did not accept the submissions of the Appellant in regard to construction se....
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....rvice tax to the party relates to "Construction Services". The show cause notice alleged that no service by such name finds place in the definition of taxable services. It is alleged that the only two similar services are "construction of residential complex services" and "Industrial Construction Services", but the Notices has not mentioned under which category said credit has been availed. It is also the case therein that the Notices has not established any nexus between the input and output service. 5.7.2 I observe that the said service has been received from multifarious parties. The said services were availed by the Noticee for carrying out the civil work in relation to building of the sites and foundations of the towers/ shelters of the Noticee. The study of the specimen invoices issued by the parties providing construction services reflect that the entire scope of the activities carried out by them is nothing but civil work necessary for tower site building and construction of tower foundations. The said activities in their widest scope include initial site cleaning, earth work in excavation, Earth filling and Compaction, transportation and shifting of templates, fixing of ....
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....aning of the words and phrases occurring in the body of the statute. However, even when an extended definition is used, it is necessary to draw a line to exclude categories obviously not intended to be included. I further find that a 'service' not mentioned in the extended definition has to partake of the characteristics common to the other services specifically mentioned, in order to become an 'input service' as per extended definition. The 'Construction Services' availed by the party to keep their cell sites operational was not used in relation to setting up, modernization, renovation or repairs of a factory, premises of provider of output service or an office relating to such factory or premises and therefore, I am of the view that such services cannot be considered to e 'input service' even as per the extended definition and I do not find any strength in part's arguments in this regard. 10. It will be seen from a perusal of the aforesaid paragraph that though the Commissioner noticed that the service was availed by the Appellant for carrying out the civil work necessary for tower site building and construction of tower, but Cenvat Credit has been denied for the following reaso....
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....receive radio signals. These antennas which transmit signals are, therefore, an integral and essential part of the service. They are mounted on towers so as to raise the heights of the antennas. Civil work is, therefore, required to be undertaken for erection of the towers. The nature of work has been highlighted in the submissions made by the learned Counsel for the Appellant. Construction service is, therefore, an integral part of the telecommunication services and is used for providing the output service. It, therefore, qualifies as an input service. 14. This issue was also examined by a Division Bench of the Tribunal in Vodafone Essar South Ltd., Aircel Cellular Ltd., Dishnet Wireless Ltd., Vs. CST, Chennai 2018 (1) TMI 1218 - CESTAT Chennai, and the observations are as follows: "12. On the second issue regarding eligibility of various credits on input services, we note that the main activity of which substantial credit has been availed by various appellants is with reference to erection and construction of telecommunication towers. The plea of the Appellant is that these towers are basic essential requirements for telecommunication service. As such, the service of erecting ....
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....bunal in M/s Vodafone Essar Cellular Ltd. Vs Commissioner of GST and Central Excise Chennai South Commissionerate 2018-TIOL-3889-CESTAT-MAD, and the observations are: "7.1. The third issue that arises for consideration is that credit availed on various input services. The Appellant has given the details of the various input services in the table as shown above. The services of erection, construction and installation of towers and shelters were availed by the Appellant for providing output service of telecommunication. These services have direct nexus with the output service and therefore, is eligible for credit. The Tribunal in the Appellant's own case vide Final Order dated 22.01.2018 has allowed the credit. For this reason, we hold that the credit on this service is eligible." (emphasis supplied) 17. The second service for which Cenvat Credit has been denied is clearing and forwarding service. "CLEARING AND FORWARDING SERVICE" 18. The reason why credit of input service has been denied for clearing and forwarding service is contained in paragraph 5.8.3 of the Order and is reproduced below; "5.8.3 From the details as submitted by the party with regard to the functions of th....
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.... would, therefore, be an input service. This is what was also observed by a Division Bench of the Tribunal in Commissioner of C.Ex. & S.T. & Cus., Bangalore-II Versus Nash Industries 2016 (45) S.T.R. 233 (Tri. - Bang.), and the observations are: "If we examine the above stated definition of 'input service', we will find that it has a very wide scope as held by the Hon'ble Bombay High Court in the case of Coca Cola v. CCE, Pune -III 2009 (242) E.L.T. 168 (Bom.) and further while allowing the Cenvat Credit with regard to input services involved in these appeals, the learned Commissioner has relied upon various decisions of the Courts and the Tribunals and has also mentioned about the nexus. In this regard Para 6.5 of the impugned order is reproduced herein. 6.5 The next issue is nexus of various input services and the manufacturing activity/ business of the Appellant is as follows; Sl No. Nature of service Nexus Relied upon decision - - - - - - - - - - - - 4. Clearing and forwarding services This is clearance charges meant for clearing imported raw material, components, consumables, etc., required for production Specifically covered under the definition of ....
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....ed to be included. I further find that a 'service' not mentioned in the extended definition has to partake of the characteristics common to the other services specifically mentioned, in order to become an 'input service' as per extended definition." 25. A perusal of the aforesaid order indicates that Cenvat Credit has been disallowed for the following two reasons: 1. Correct nomenclature has not been used to describe such taxable service. 2. No nexus with provision of output service. 26. It has been submitted by learned Counsel for the Appellant that the said service is used for procuring suitable plots for construction of the shops of the Appellant. The service has been used in relation to activities relating to the business of the Appellant and is also commercially expedient for the Appellant. Thus, the said service is used in relation to the setting up of the office of the Appellant and qualifies as an input service. 27. The learned Authorised Representative of the Department has refuted the averments made by the learned Counsel of the Appellant and has submitted that the impugned order is based on sound reasoning. 28. It is seen that the Appellant has used this service ....