TaxTMI 
TaxTMI 
2026 (2) TMI 895
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....or modernization, renovation and repair of the factory. 3. The brief facts are M/s. Bharat Petroleum Corporation Limited the Appellant is engaged in the manufacture of petroleum products falling under Chapters 27, 28 and 29 of first schedule of the Central Excise Tariff Act, 1985. The Appellant availed Cenvat Credit on various inputs, input services and capital goods used in the manufacture of final products and utilized the same towards payment of Central Excise duty at the time of clearances of final products as per Cenvat Credit Rules, 2004. During the course of audit, objections were raised with respect to availment of credit on various services for the period from February 2012 to June 2017. On scrutiny of the documents submitted by the Appellant, 6(six) periodical show cause notice(s) were issued to the Appellant, proposing to demand Cenvat Credit on the services mentioned at para 2 supra, alleging that the Appellant had wrongly availed and utilized credit on the input services which were excluded under Rule 2(l) of Cenvat Credit Rules, 2004. The Appellant contended that the maintenance of water coolers and the upkeep of canteen were in terms of statutory obligation under ....
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....ating, share registry. security, business exhibition, legal services, inward transportation of inputs or capital goods and outward transportation upto the place of removal, but excludes: (A) service portion in the execution of a works contract and construction services including service listed under clause (b) of section 66E of the Finance Act (hereinafter referred as specified services) in so far as they are used for- (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 ve....
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....ment for a factory wherein more than 250 workers are ordinarily employed. Further, Section 11 and 47(2) of the Factories Act, stipulates that the workplace, the shelters or rest rooms or lunchrooms shall be maintained in a cool and clean condition; similarly, the provisions for drinking water facility is a mandatory requirement where more than 250 workers are ordinarily employed under Section 18(3) of the Factories Act. 1948; the Appellants have installed water coolers at the factory premises and canteen for providing drinking water facilities to the employees under the provisions of the Factories Act and have availed the services viz. AMC for maintenance of water coolers. Further, housekeeping, repair and maintenance service has been availed for the upkeep of the canteen; further, non-providing of these facilities may affect the production; hence, the maintenance of water cooler, housekeeping services are essential and are related to the manufacturing activities; therefore in order to comply with mandatary requirements of various statutory provisions of the Factories Act, the Appellants have received the impugned services which are not primarily for the personal use or consumption....
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....cifically excludes services relating to construction of building or civil structures, however has an inclusive clause which includes services used in relation to modernisation, renovation or repairs of a factory; in the instant case, the Appellant availed works contract / construction / architectural services in relation to repair, renovation and modernisation of factory premises viz., renovation of toilets at workshop, replacement and repair of false ceiling, civil works in DHDS utility, rectification of roof leak, repair of weather shelter handrail, tile laying in toilets, repair of benches at workshop, etc.; the statement giving the nature of works carried out against each item was submitted to the department and sample copies of invoices clearly shows that the services were used mainly for renovation, modernization and repairs of a factory premises; although the Appellant has raised invoice classifying the service as works contract and construction services, the same would not fall in the exclusion portion as the services were not in relation to construction of building, civil structure or part thereof or for laying foundation or structures for capital goods, as envisaged in th....
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...., the credit of service tax paid on construction service as an 'input service', being used in modernization, renovation or repair falls under the inclusive part of the definition and are eligible for credit; in this regard, reliance is placed on the following case laws; a) Ion Exchange (1) Lad Vs. Commissioner of C. Ex. Cars & ST. Sarut-11-2018 (12) G.S.T.L. 302 (Tri-Ahmd1). b) WM Global Sourcing India Pvt. Ltd. Vs. Commissioner of Central Tax, Bengaluru East-2022 (56) G.S.T.L. 411 (TriBang.) 10. Learned Counsel submits that; the architectural services availed by the Appellant are in form of renovation / modernisation of factory, thereby eligible for credit as being covered under the inclusive part of the definition. In this regard, reliance is placed on Carrier Airconditioning & Refrigeration Ltd. Vs. C.C.E., Delhi-IV-2016 (41) S.T.R. 824 (Tri-Chan), wherein credit on architectural services was held to be admissible; in view of the judicial precedents and the Circular dated 29.04.2011, the works contract / construction / architectural services are not falling under the scope of exclusion clause but are covered under the ambit of inclusion clause, being....
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.... (307) ETL 15 (Guj.) b. Gac Shipping (India) Pvt. Ltd. vs. CCE & CUS, Cochin - 2017 (49) S.T.R. 242 (Tri. -Bang.) 12. Learned Authorised Representative (AR) for the Revenue reiterated the findings in the impugned order of the Commissioner (Appeals). 13. Heard both sides and perused the records. 14. We find that services of Annual Maintenance Contract (AMC) for water coolers, Housekeeping / cleaning / maintenance / repair services related to canteen were availed by the appellant as they are required to provide certain facilities in the factory as per provisions of the Factories Act, 1948. As per Section 46(1) of Chapter 5 of the Factories Act, 1948, the provision of canteen facility is a mandatory requirement for a factory, wherein more than 250 workers are ordinarily employed. Further, Section 11 and 47(2) of the Factories Act, stipulates that workplace, the shelters, rest rooms, lunchrooms shall be maintained in a cool and clean condition. Further the provision of drinking water facility is a mandatory requirement were more than 250 workers are ordinarily employed under Section 250(3) of the Factories Act, 1948. Thus, we find to meet these above requirements, App....
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....envat credit of the Service Tax paid to them for providing such service. The authorities have to appreciate that the aforesaid activities are indispensable in any factory and are therefore covered under the definition of input service. I agree with the contention of the appellants that canteen is an integral part of the factory and clean maintenance of the factory including its precincts are a statutory requirement under Section 11 of the Factories Act, 1948. Therefore, this service has to be treated as a service used by the manufacturer in or in relation to the manufacture of final product as without complying with the said provisions of the Factories Act, 1948, manufacturing operations are not possible. Without the factory including the canteen, being clean and tidy, the efficiency would get drastically reduced. Further, it should be borne in mind that housekeeping is crucial for safe workplaces. It can also help an employer avoid potential fines for non-compliance due to bad housekeeping, which would in turn affect productivity. In view of this the appellants are eligible for credit. The appellants also raised the plea of non-invocation of extended period. The appellants have co....