TaxTMI 
TaxTMI 
2026 (2) TMI 5
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....ited ('BASL'). When the Appellant acquired the plant, they initially carried out the manufacturing activities with the old plant but soon it was felt that the old machineries in the plant were not viable for manufacturing and hence modernization was undertaken. Such factory had various divisions such as Wire Rod Mill, Bar Mill, Rebar Service Centre, Utility division, Fly Ash & Paver Bricks, Cooling Pond and Pig Iron Plant. 4. To carry out the erection, commissioning and installation of the capital goods for the purpose of modernization of the integrated steel plant, the Appellant received various 'input services'. Further, toundertake the manufacturing activity, the Appellant received various input services. Some portion of the expansion project did not eventually materialize, however, the credit on input/ input services in relation thereto was availed being in relation to the business of manufacturing. The Appellant availed the Cenvat Credit of duties and taxes paid thereon on such input services in accordance with the Cenvat Credit Rules, 2004 ('Cenvat Credit Rules') and duly reflected such availment in the books of accounts as well as the periodic excise returns filed during ....
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....e underlying input services. Vide such replies, it was submitted that the Cenvat Credit on all the underlying input services is eligible to the Appellant since all such services were either used in or in relation to the manufacturing activity undertaken by the Appellant. Further, the Appellant also disputed the invocation of extended period of limitation since all the Cenvat credit was duly disclosed in the ER-1 returns filed regularly by the Appellant. 9. In complete disregard to such submissions, the impugned Order confirmed the denial of Cenvat credit availed during the relevant period based on the following findings: a. The credit of service tax paid on input services which were used to set-up an additional plant, some of which were not installed, could not be used for discharging the duty liability of the final products manufactured in the plant which was in existence, since credit on such input services were admissible only in case where the same was used by manufactured in or in relation to the manufacture of final products. b. The setting up of factory was removed from the inclusive part of the definition of 'input service' w.e.f. 01.04.2011, thus, the ....
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....ting plant and machinery. For installation of such additional plant and machinery in the factory premises, as well as the modernization / repair of the existing plant and machinery, the Appellant received various input services, the credit of which was availed. 15. As per the definition of 'input services' provided under Rule 2(l) (ii) of the Cenvat Credit Rules, 2004, ""input service" means any service used by the manufacturer, whether directly or indirectly, in or in relation to the manufacture of final products, and clearance of final products upto the place of removal and includes services used in relation to setting up, modernization, renovation or repairs of a factory...." 16. As is clearly evident from the above definition, the ambit of "input services" is quite wide and it includes services which are used in relation to setting up, modernization, renovation or repairs of a factory. The Department has ignored the inclusive portion of the definition of input services and has confirmed the demand merely basis the finding that input services are only those services which are used by the manufacturer, in or in relation to the final products. 17. Therefore, the Appellant....
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....Tri. - Del.) 22. He relied on the following decisions wherein Cenvat credit on construction / works contract service, for setting up of factory, was held to be admissible post 01.04.2011- * M/s. Aditya Aluminium v. CCE, C & ST, Bhubaneswar - Final Order No. 75326/2023 dated 01.08.2023 in Appeal No. E/76293/2017 of Hon'ble CESTAT Kolkata * Brahmani River Pellets Ltd. v. Commr. of CGST &Cx, Rourkela Commissionerate - Final Order No. 77204/2023 dated 26.09.2023 in Appeal No. E/75986/2019 of Hon'ble CESTAT Kolkata * Adroit Pharmachem Private Limited Versus Commissioner of Central Excise & ST, Vadodara Final Order No. A/12641/2021 dated 31.12.2021 in Appeal No. E/11007/2019 of the Hon'ble CESTAT Kolkata * Pepsico India Holdings Pvt. Ltd. v. CCT, Tirupati, Final Order No. A/3024730248/2021 dated 26.07.2021 in ST/30122/2018 of Hon'ble CESTAT Hyderabad * General Motors India (P.) Ltd. v. Commissioner of Central Excise & Service Tax - [2024] 159 taxmann.com 263 (Ahmedabad - CESTAT) [para 4.1 and 4.2] * Bombay Market Art Silk Co-Op (Shops & Warehouse) Society Ltd. v. Commr. of C. Ex., & ST, Surat - I - 2022 (65) G.S.T.L. 86 (Tri. - Ahm....
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.... the common input credit. 26. Further he relied on the decision of the Hon'ble CESTAT Kolkata in the case of Larsen & Toubro v. Commissioner of CGST & C. Ex., Bhubaneswar -2023 (384) E.L.T. 222 (Tri. - Kolkata), wherein it was held that general principles in respect of utilization of creditis that there is no requirement of one-to-one correlation and cross-utilization of credit is permissible. 27. Again he relied on the decision of Amul Crankshaft Pvt. Ltd. v. Commissioner of C. Ex., & S.T. Rajkot - 2016 (341) E.L.T. 433 (Tri. - Ahmd.). In such case, the assessee was engaged in the manufacture of crankshaft/camshaft and availing Cenvat credit on the 'inputs' used for its manufacture. The assessee was also undertaking job work services for a different manufacturer andwas clearing the scrap generated during such job work activity by debiting the Cenvat account. The department disputed such utilization of Cenvat credit for clearance of the scrap generated during the hob work activity, on the grounds that such Cenvat credit pertained to the inputs used for manufacturing its own goods. The Hon'ble CESTAT allowed the appeal of the assessee by holding that there is no one to one co-....
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....for the underlying period. 37. Further to the above, such information regarding the availment of Cenvat credit for the relevant period was also furnished at the time of audit. 38. Despite the above clear disclosures, the impugned Order provided a finding that the Appellant willfully suppressed the information regarding the type of input services on which Cenvat Credit was availed. Accordingly, extended period of limitation was invoked. 39. In accordance with the above, all the information required to be disclosed in the statutory returns was duly and correctly disclosed by the Appellant. Neither any incorrect information, nor incomplete returns were filed by the Appellant. Therefore, the Appellant cannot be said to have suppressed any information from the Department. In this regard, he also relied on the following decisions: a. CCE &Cus. v. Reliance Industries Ltd., 2023 (385) E.L.T. 481 (S.C.) b. MVV Builders v. CCE & ST, Andhra Pradesh, Final Order No. A/3051730518/2025 dated 25.11.2025 in Appeal No. ST/22443/2014 c. Pushpam Pharmaceuticals Company v. CCE, Bombay, 1995 (78) E.L.T. 401 (S.C.) 40. Further, Hon'ble CESTAT in the case of M/s. He....
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....r in relation to the manufacture of final products and clearance of final products from the place of removal, and includes services used in relation to setting, modenization, 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 up to the place of removal, procurement of inputs, activities relating to business to business, such as accounting, auditing, financing, recruitment and quality control, coaching and training, computer networking, credit rating, share registry and security, Inward transportation of inputs or capital goods and outward transportation up to the place of removal Rule 3. Cenvat Credit.(1) A manufacturer or producer of final products or a provider of taxable service shall be slowed to take credit (hereinafter referred to as the Cenvat credit) of- - - (ix)The Service Tax leviable under Section 66 of the Finance Act paid on- (ii) any input service received by the manufacturer of final product or by the provider of output service on or after the 10th day of September, 2004 6.3 It is e....
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....rtook the project of survey and exploration of Gomia Saram Coking Coal Block from MMTC in anticipation of obtaining fairly good quality coal for the purpose of usage of such coal in the manufacture of steel products in its plant. In this regard, the appellant entered into an agreement with M/s. Naresh Kumar & Co. Private Limited as contractor for conducting pre-feasibility study and preparation of prefeasibility report including exploration of Gomia Saram Coking Coal Block in the Giridih district of the State of Jharkhand. 2.2 M/s. Naresh Kumar & Co. Private Limited rendered these services to the appellant during the contract period and the service tax amount was paid by the appellant. The credit of the service tax paid on these services was taken by the appellant. However, after the survey and exploration of the sad Coal Block was conducted, it was noticed that the coal in the block contained relatively high ash content due to which the same could not be obtained or used by the appellant. 2.3 The Department vide letter dated 04.11.2010 initiated proceedings to question the availment of credit on the services received in the Gomia Saram coal block and the appellan....