TaxTMI 
TaxTMI 
2023 (1) TMI 506
X X X X Extracts X X X X
X X X X Extracts X X X X
.... 2012-14. 2.1 Learned Counsel argued that pursuant to audit conducted for the material period, certain audit observations were made, interalia, to the effect that the Appellant had wrongly availed Cenvat Credit and vide letter dated. 20.10.14, the Appellant inferred that they reversed the entire alleged wrongly availed Credit. Further, he claimed that the Appellant had reversed the entire Credit on account of insistence by the Audit Party along with amount of penalty of Rs. 1,28,38,089/- under protest. That the Appellant had neither agreed, nor voluntarily paid any such amount during the course of Audit at all as evident from their letter dated 02.04.2015. 2.2 Learned Counsel argued that the Appellant had not sought closure of the issue, since penalty was also imposed on them by audit party, and their request to close the issue under Section 11A(2B) / Section 73(3) was not adhered to by audit party. In fact, vide letter dt.7.4.15, the Audit Commissioner categorically stated that the Appellant is free to litigate the matter. Pursuant to this, SCN dt.27.7.15 was issued to the Appellant, seeking to recover and appropriate the credit and penalty amounts paid under protest. 2.3....
X X X X Extracts X X X X
X X X X Extracts X X X X
....gned order seeks to deny Cenvat Credit on the following nature of Services, on the ground of that it has no nexus with production activity within factory and it is a part of setting up of plant and machinery. He pointed out that the actual list of services as mentioned at Para 37.4 of the impugned order is at Sr. Nos.1 to 12 below, but since impugned order also discusses general service heads as part of findings, the same too are explained and discussed, as hereunder from Sr. Nos.13 and 14. SI. No. Nature of Services Services used for Legal Authority 1 Erection, Commissioning and Installation 1. Without erection, commissioning of plants and machines, it is not possible to undertake production activity. 2. The very fact that erection, commissioning was of valid capital goods, the nexus with production activity stands established. 3.Absence of words "setting up" in definition of the term "input service" does not affect concept of "in relation to" to qualify as input service a. Hollister Medical India P. Ltd. 2017 (49) STR 426 (Tri.-....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... (Tri-mum), b. Bharat Fritz Warner Ltd. 2011 (22) S.T.R. 429 (Tri. - Bang.) 7 Real Estate Agent Service To procure premises on lease to run factory a. DELTA ENERGY SYSTEMS LTD 2013 (31) S.T.R. 684 (Tri. - Del.) 8 Intellectual Property Right other than copyright Technology transfer, technical guidance, assistance and training a. MANGALORE REFINERY & PETROCHEMICALS LTD 2015 (319) E.L.T. 121 (Tri. - Bang.) 9 Legal Consultancy Fees for management consultancy or technical consultancy for production and manufacturing operation Getting approvals for starting business/ land clearance etc. a. M/s. Heartland Bangalore Transcription Services (P) Ltd. vs. CST: 2011 (21) STR 430 (Tri.-Bang.) b. Deloitte Tax Services India Pvt. Ltd.: 2008 (11) STR 266 (Tri.-Bang.) c. Megma Design Automation India P. Ltd. 2015 (40) S.T.R. 800 (Tri. - Bang.) d. HCL TECHNOLOGIES LTD 2015 (40) S.T.R. 1124 (Tri. - Del.) 10 Rent-a-cab Services pertain to car rental for transportation of employees to the....
X X X X Extracts X X X X
X X X X Extracts X X X X
....Integra Software Services P. Ltd 2018(10)TMI 765- CESTAT Chennai i. Golflinks Software Park P. Ltd. 2018 (8) TMI 331 - CESTAT BANGALORE 2.8 He argued that given the interpretational issue involved, especially when the matter is well covered vide catena of decisions available on the issue, neither extended period of limitation be invoked nor any penalty can be imposed on the Appellant. He further argued that the whole of demand is time-barred, given the fact that there are plethora of decisions covering the issue in the favour of the Appellant. That the bonafide belief entertained by the Appellant cannot be doubted in the circumstances. 3. Learned AR relied on the impugned order. 4. We have considered the rival submissions, we find that the appellants are engaged in manufacture of steel, coils. The appellants were setting up their new plants and while setting up their new plant, the appellant availed various services. The revenue has sought to deny input credit of various services used by the appellant on the ground that the definition of input service was amended with effect from 01.04.2011 to exclude the services used for setting up of factory premi....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... (a) construction or execution of works contract 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) [services provided by way of renting of a motor vehicle), in so far as they relate to a motor vehicle which is not a capital goods, or [(BA) service of general insurance business, servicing, repair and maintenance, in so far as they relate to a motor vehicle which is not a capital goods, except when used by- (a) a manufacturer of a motor vehicle in respect of a motor vehicle manufactured by such person; or (b) an insurance company in respect of a motor vehicle insured or reinsured by such person; or]] (C) such as those provided in relation to outdoor catering, beauty treatment, health services, cosmetic and plastic surgery, membership of a club, health and fitness centre, life insurance, health insurance and travel benefits extended to employees on vacation such as Leave or Home Travel Concession, when such services are used primarily for personal use consumption of any ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....nagement Consultancy services, Legal Consultancy Services and other like services received from legal consultant, advocate and other service providers as discussed above to be used in drafting of Agreements/ Contracts, for hiring of office premises/ hotel. Car rental (Rent-a-cab), share subscription & share holders, General Corporate and Commercial purpose, lease of Hotel Room, EC compliance report, agreement of the proposed new building at Dahej unit. Also the services received from M/s. Sanguine Management are Land related services which had been received in relation to the land that was already identified for setting up of New Plant and Machinery at Dahej. Therefore, I find that all these services have no relevance / nexus directly/ indirectly with the manufacturing activities and they are used for and during the setting up of their new plant and machinery/ factory, office premises. The case laws relied upon by the assessee are not applicable to the present case. 37.8 I find that these services received by the assessee were not in the nature of input services in terms of Section 37 (2) (xviaa) of Central Excise Act, 1944 which provide for credit of Service Tax leviable ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....factory. After 1-4-2011, it has three parts - a main part, an inclusive part and an exclusive part. The services used for setting up the factory are neither in the inclusive part of the definition nor the exclusive part of the definition. Therefore, such services. were neither specifically included nor were specifically excluded. 17. It takes us to the main part of the definition which must be examined. If it is wide enough to cover the services in question, Cenvat credit will be available, otherwise it will not be available. The main part includes "services used by a manufacturer, whether directly or indirectly, in or in relation to the manufacture of final products and clearance of final products up to the place of removal." The term manufacture is not defined in the Rules. 18. The definitions as per Rule 2 of CCR, 2004 reads as follows: RULE 2. Definitions. (1) In these rules, unless the context otherwise requires, (a) XX XX XX (b) XX XX XX (1) XX XX XX (2) The words and expressions used in these rules and not defined but defined in the Excise Act shall have the meanings respectively assigned to them in the Excise Ac....
X X X X Extracts X X X X
X X X X Extracts X X X X
....actory, there cannot be any manufacture. Services used in setting up the factory are, therefore, unambiguously covered as 'input services' under Rule 2(1)(ii) of the Cenvat Credit Rules, 2004 as they stood during the relevant period (post 1-4-2011). The mere fact that it is again not mentioned in the inclusive part of the definition makes no difference. Once it is covered in the main part of the definition of input service, unless it is specifically excluded under the exclusion part of the definition, the appellant is entitled to Cenvat credit on the input services used. This Bench has already taken this view in Kellogs. Similar views have been taken by the other Benches in the other cases mentioned above. 23. In view of the above, the impugned orders denying Cenvat credit and ordering its recovery along with interest and imposing penalties cannot be sustained. The impugned orders are set aside and the appeals are allowed with consequential reliefs, if any." The impugned order does not examine the admissibility of Cenvat Credit of these services in the main part of the definition, but relies solely on the changes made in the inclusive part of definition. In term....