TaxTMI 
TaxTMI 
2022 (4) TMI 130
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....zed dealers/franchises paid service tax on the amount received from the appellant and the appellant have claimed Cenvat Credit of the said amount. It is not in dispute all these services are provided during the warranty period. In appeal No. E/13887/2013 the period involved is April, 2006 to September, 2012 and in appeal no. E/10245/2020 period involved is April, 2013 and to March, 2016. 2.1 Learned Counsel for the appellant pointed out that the issue regarding admissibility of credit on maintenance and repair services provided during the warranty period for periods both prior to 01.04.2011 and after 01.04.2011 has been examined by the Tribunal in its order in the case of M/s Case New Holland Construction Equipment (I) Pvt Ltd- 2021 (8) TMI 963- CESTAT New Delhi. In view of the above Learned Counsel pointed out that the credit is clearly admissible and demand needs to be dropped. He also relied on the following decision. * Power Build Pvt Ltd- 2020(12) TMI 1172- CESTAT Ahmedabad * M/s Lucas Tvs Ltd - 2019 (9) TMI 1131- CESTAT CHENNAI * M/s Kohler Power India P.Ltd- 2019 (10) TMI 841- CESTAT MUMBAI 3. Learned AR pointed out that the Tribunal decisions in the case of Mahindra....
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....he appellant as the manufacturer of such goods, which are enumerated under the warranty policy of the final products. The dealers provide the services in accordance with the checklist provided by the appellant. The appellant also contends that it manufactured the final products with the sole intention to sell them and thus, sale of goods is integrally connected in relation to the manufacture of goods. The contention, therefore, is that since the repair and maintenance services are fundamentally linked to sale and sale directly affects the manufacturing activities, the services were used indirectly in relation to the manufacture of final products and would fall under the 'means' part of the definition of 'input service'. Thus, it has been contended that the appellant was justified in availing 11 E/52867/2018 CENVAT credit of the service tax paid by the appellant on 'maintenance and repair services'. 20. The issue, therefore, that arises for consideration in the present appeal is whether CENVAT credit of service tax paid by the appellant on 'repair and maintenance services' provided by the dealers for fulfilling the warranty obligations of the appellant has been denied for good and....
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....mphasis supplied) 23. 'Input service' either prior to 01.04.2011 or w.e.f. 01.04.2011 means any service used by the manufacturer, whether directly or indirectly, or in relation to the manufacture of final products. The appellant is under an obligation to provide after sale service on the final products manufactured by it. The dealers provide the services and the appellant pays service tax on the amount paid by it to the dealers. The service is provided free of cost by the dealers during the warranty period but the appellant makes payment to the dealers for the services they provide to the customers. The repair and maintenance services are, therefore, linked to the sale. The services are, therefore, used indirectly in relation to the manufacture of final products. 24. This precise issue was examined by the Tribunal in Carrier Airconditioning & Refrigeration and reliance was placed by the appellant on this decision when the matter was heard by the Tribunal for the earlier period from April 2011 to June 2015. It would, therefore, be appropriate to examine this decision of the Division Bench of the Tribunal. 25. The appellant therein was a manufacturer of air conditioners and was....
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.... The point of dispute is as to whether the service provided by the dealers to the appellant is an input service and whether the appellant would be eligible for Cenvat credit in respect of the same. The service received by the appellants from their dealers is Business Auxiliary Service which has to be treated as an input service for the appellant used in or in relation to manufacture of their final products, as free warranty repair and maintenance during warranty period, has enriched the value of the goods. This issue stands decided in favour of the appellant by the Tribunal's judgment in the case of Danke Products (supra) and Gujarat Forgings (supra) and also in the case of Zinser Textile Systems Pvt. Ltd. (supra). In view of this, this Cenvat credit demand is also not sustainable and has to be set aside." [emphasis supplied] 26. In Honda Motorcycle & Scooter India, the same issue was considered by a Division Bench of the Tribunal. The appellant was engaged in the manufacture of motorcycles & scooters and had availed CENVAT Credit on inputs, capital goods and input services under the Credit Rules. The dispute was for the period June 2011 to March 2016. The Tribunal examined whet....
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....16 E/52867/2018 'input services' for the goods manufactured and cleared by the appellant. The Tribunal, in view of the earlier decision of the Tribunal in Mahindra & Mahindra Ltd., held that the CENVAT credit can be taken on service tax paid on expenses incurred for providing warranty service. 29. The Division Bench of the Tribunal, in the own case of the appellant, for the earlier period from April 2011 to June 2015, however, took a contrary view holding that the earlier decisions of the Tribunal in Carrier Airconditioning & Refrigeration and Samsung India Electronics were distinguishable since they were rendered for the period prior to 01.04.2011, when the definition of 'input service' was different. The finding recorded by the Tribunal in this decision dated 24.11.2017, is again reproduced below: "We have also perused the case laws citied by the appellant but find that the case laws have been rendered for the period prior to the 01.04.2011 when the definition of 'input service' was different. We find that these case laws are not applicable for the period under consideration." 30. A perusal of the decision of the Tribunal in Carrier Air conditioning & Refrigeration would in....
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....ould decline to follow a case decided by itself or any other court (even one of superior jurisdiction), if the judgment erroneously assumed the existence or non-existence of a statute, and that assumption formed the basis of the decision. This exception to the rule of stare decisis is probably best regarded as an aspect of a broader qualification of the rule, namely, the courts are not bound to follow decisions reached per incuriam." 35. In State of U.P. vs. Synthetics and Chemicals Ltd, the Supreme Court observed: "40. 'Incuria' literally means 'carelessness'. In practice per incuriam appears to mean per ignoratium. English courts have developed this principle in relaxation of the rule of stare decisis. The 'quotable in law' is avoided and ignored if it is rendered, 'in ignoratium of a statute or other binding authority'. (Young vs. Bristol Aeroplane Co. Ltd12) Same has been accepted, approved and adopted by this Court while interpreting Article 141 of the Constitution which embodies the doctrine of precedents as a matter of law." 36. The maxim 'per incuriam' is derived from the latin expression that means 'through inadvertence'. The literal meaning of the expression 'per in....
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....t have been decided in ignorance of a rule of law binding on the court, such as a statute. (See the observations in 'Salmond on Jurisprudence" Twelfth Edition, pages 150 and 169)." 39. It, therefore, follows that the principle of per incuriam can be applied for such decisions which have been given in ignorance of some statutory provision or some authority that is binding. 40. In the present case, the Tribunal in the decision dated 24.11.2017, distinguished the earlier binding decisions of the Tribunal on a mistaken belief that an amendment had been made in a definition of "input service", whereas the 'means' clause of the definition had come up for consideration before the Tribunal and it had not been amended. The Division Bench proceeded on an assumption that the benefit of CENVAT credit was being taken by the appellant therein either under the 'includes' clause or 'excludes' clause of the definition of 'input service', which portion had been amended whereas reliance had been placed by the appellant on the decisions which had interpreted the 'means' clause of the definition of the 'input service'. It was, therefore, clearly a case where that part of the statutory provision tha....