TaxTMI 
TaxTMI 
2026 (3) TMI 981
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....common order. Details of appeals are as under in a tabular form: S. No. Appeal No. Issue Period Amount in dispute (Rs.) OIO No. Demand status 1. ST/1017/2011 filed by the Assessees Wrongful availment of CENVAT Credit on capital goods such as towers, air conditioners, DG sets, Battery sets and pre-fabricated structures, as well as input services used in construction /erection of transmission towers. Oct 2008 to March 2010 2,17,21,367/- with interest, equal penalty & penalty of 5000/- 11/RDN/2011 dated 30.03.2011 Demand confirmed 2. ST/55426/2013 filed by the Assessees 2010-11 2,69,44,687/- with interest, 200/- or 2% penalty per day and penalty of 5000/- 167/ST/PKJ/ CCE/Adj/ 2012 dated 15.10.2012 3. ST/1242/2011 filed by the Revenue Denial of transfer of CENVAT Credit upon shifting of Centralized Registration from Jaipur to Gurugram Oct 2008 to March 2010 1,71,37,92,147/- 11/RDN/2011 dated 30.03.2011 Demand dropped 2. Briefly stated facts of the present case are that the Assessees, M/s Sistema Shyam Teleservices Ltd were registered centrally as a service provider in the category of Telecommunication Serv....
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....s along with interest and also imposed equal penalty under Section 78 of the Finance Act and penalty of Rs.5,000/- under Section 77 of the Act. However, the Adjudicating Authority dropped the demand of Rs.1,71,37,92,147/- and refrained from imposing penalty under Section 76 of the Act. 2.2 Subsequently, another show cause notice dated 19.09.2011 was issued proposing to deny and recover the CENVAT Credit of Rs.2,69,44,687/- for the period 2010-11 on the same grounds that the Assessees had availed/utilized credit on capital goods and input services used for fabrication of towers, which resulted in immovable property, which was not admissible to them in terms of Cenvat Credit Rules. After following the due process, the Adjudicating Authority vide impugned OIO dated 15.10.2012 confirmed the demand of Rs.2,69,44,687/- along with interest thereon and also imposed penalty of Rs.200/- for every day during which failure continues or @2% of such amount of tax per month, whichever is higher, under Section 76 of the Act and penalty of Rs.5,000/- under Section 77 of the Act. 2.3 Being aggrieved by the part of impugned OIO dated 30.03.2011, relating to denial and recovery of credit of Rs.2....
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....for ensuring stability and can be dismantled, relocated and reassembled without substantial damage. The Hon'ble Supreme Court has also held that although towers and shelters are not themselves devices for transmission or reception of signals, they are indispensable for the functioning of antennas which transmit and receive radio signals and consequently, such infrastructure is essential for rendering the output service of mobile telecommunications and hence, their use in providing output services, qualifies them for credit under the Cenvat Credit Rules. He further submits that the aforementioned judgment of the Hon'ble Supreme Court has been consistently followed by the various High Courts and Tribunal in the following cases: * Bharti Airtel Ltd vs. CCE, Guwahati - 2025 (2) TMI 684 - Guwahati HC * Vodafone Idea Ltd vs. CC & CCE, Meerut - 2025 (2) TMI 375 - CESTAT Allahabad * Vodafone Idea Ltd vs. CGST & CE, Coimbatore - 2025 (7) TMI 842 - CESTAT Chennai * Vodafone Idea Ltd vs. CST, Mumbai-III - 2025 (7) TMI 702 - CESTAT Mumbai * Vodafone Idea Ltd vs. CST, Mumbai - 2024 (10) TMI 149 - CESTAT Mumbai * B.S.N.L. vs. CCE, Chhattisgar....
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....enjoyment of the building or the land. Further, the tower is fixed to the land or building for enhancing the operational efficacy and proper functioning of the antenna which is fixed on the tower by making it stable and wobble free. The fact that the tower, if required can be removed, dismantled in the CKD and SKD and sold in the market is not disputed. Application of the tests evolved and discussed above on these items clearly points to the movability as opposed to immovability of these items. We are, thus, of the view that mobile towers and PFBs are movable properties and hence, "goods". **** **** **** 11.11.12 We, therefore, agree with the conclusion arrived at by the Delhi High Court that towers and shelters (PFBs) support the BTS/antenna for effective transmission of mobile signals and thus enhance their efficiency and since these articles are components/accessories of BTS/antenna which are admittedly "capital goods" falling under Chapter 85 within sub-clause (i) of Rule 2(a) (A) of CENVAT Rules, these items consequently are covered by the definition of "capital goods" within the meaning of sub-clause (iii) read with sub-clause (i) of Rule 2(a)(A) of CENVAT R....
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.... Extending the same logic to the use of input services for provision of the output services we will come to inevitable conclusion that these services are squarely covered by Rule 2(1) of CENVAT Credit Rules, 2004 and hence the credit of service tax paid in respect of these services would be admissible to the appellant." (Emphasis Supplied) 6.3 Similarly, Chennai Bench of the Tribunal in the case of Vodafone Idea Ltd vs. CGST & CE, Coimbatore (supra), has held as under: "10.1 The first issue, viz. Tower related services i.e., services used to erect and construct towers, shelters, electrical and laying of optical fibre cables, is squarely covered by the decision of the Hon'ble Tribunal in the case of Vodafone Idea Limited v. CST Mumbai [2024 (10) TMI 149-CESTAT MUMBAI] in favour of the Appellant. It is apt to reproduce the relevant portion. ....... 10.2 Further, the Hon'ble Delhi High Court in the Appellant's own case vide M/s Vodafone Mobile Services Ltd. Vs. Commissioner of ST. Delhi [2019 (27) GSTL 481 (Del.)] has held that Towers and the Prefabricated shelters are not immovable property. The order reads as under: - ........ ....
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....that 'under Rule 10 of the Cenvat Credit Rules, 2004, there is no mention or bar on shifting of function of Centralized accounting and billing of a company. Therefore, when there is no bar under the law on shifting of centralized accounting & billing functioning of a company, an artificial bar cannot be created'. 9.2 The learned Special Counsel also refers to Rule 10(2) of the Cenvat Credit Rules, 2004, which provides for transfer of unutilized CENVAT Credit in certain prescribed situations only. He further submits that this is the only rule dealing with transfer of CENVAT Credit and therefore, it is presumed that the law does not allow the transfer of CENVAT Credit in situations other than those covered in Rule 10 of the Cenvat Credit Rules. He also submits that the present case, being a case of simple transfer of location of the registered premises from Jaipur to Gurgaon, is not covered under Rule 10 of the Cenvat Credit Rules. In this regard, he refers to the decision of the Larger Bench of the Tribunal in the case of CCE, New Delhi vs. Avis Electronics Pvt Ltd [2000 (117) ELT 571 (Tri. LB)] wherein it has been held that "when a particular thing is directed to be performed in....
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....idered the scope and application of Rule 10 of the Cenvat Credit Rules and has finally held that the CENVAT Credit transferred by the Assessees cannot be disallowed merely on account of transfer of centralized registration when the CENVAT Credit was correctly availed. 10.1 The learned Counsel for the Assessees/Respondent further submits that in the show cause notice dated 28.09.2010, the department has not alleged that the CENVAT Credit transferred by the Assessees from Jaipur to Gurgaon was incorrectly availed in Jaipur. The department has also not alleged that the CENVAT Credit had already been utilized in Jaipur. Therefore, according the learned Counsel, the CENVAT Credit transferred to Gurgaon was correctly availed and utilized in Gurgaon. 10.2 He also submits that accounts and records of the company had been audited by the Officer of Service Tax Authorities, Jaipur and the Office of Accountant General (Audit), Jaipur for the period till September 2009, and no infirmity was detected. 10.3 He further submits that in the present appeal filed by the Revenue, the sole ground is that the CENVAT Credit could only be transferred in situations covered under Rule 10 of the Cenv....
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....t availed by the Assessees at their Jaipur office. The department has also not alleged that the CENVAT Credit had already been utilized in Jaipur. 13. Further, we find that in the impugned OIO, the learned Commissioner has elaborately dealt with this issue by referring to the relevant provisions of the Cenvat Credit Rules. It is pertinent to reproduce the relevant findings of the learned Commissioner on this issue in impugned OIO dated 30.03.2011, which are reproduced herein below: "47. I find that there are two main issues to be decided with respect to which service tax authorities at Gurgaon had objections:- (i) Transfer of unutilized Cenvat Credit of Rs.171,37,92,147/- upon transfer of centralized registration from Jaipur to Gurgaon. (ii) Recovery of Cenvat Credit amounting to Rs.2,17,21,367/- for the period from October 2008 to March 2010 on goods such as angles, channels, steel structures etc and Rs.50,99,443/- in respect of credit taken on input services for construction/erection of towers situated outside the office premises of the service provider. 48. Now, with respect to the first issue, I find that the noticee transferred its centra....
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....and (2) shall be allowed only if the stock of inputs as such or in process, or the capital goods is also transferred along with the factory or business premises to the new site or ownership and the inputs, or capital goods, on which credit has been availed of are duly accounted for to the satisfaction of the Deputy Commissioner of Central Excise or, as the case may be, the Assistant Commissioner of Central Excise. 50. Above perusal and reading of Rule 10 indicates that its sub-rule (2) lays down the criteria for allowing transfer of CENVAT Credit lying utilized in the accounts of a service provider in an event when - i. An assessee shifts his business; or ii. An assessee transfers his business. 51. Sub-rule (2) further elaborates that both the above events, i.e. shifting or transfer of business would take place on account of the following only: a. change in ownership; b. sale; c. merger: d. amalgamation. e. lease; or f. transfer of business to a joint venture. 52. Further, conditions for allowing transfer of CENVAT Credit as laid down in Rule 10(3) would be applicable only if shifting and/or t....
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....r changes in the nature of DTA to EOU do not attract Rule 10 of the CCR. 57. As pointed out by the noticee, the accounts and records of the noticee have been audited by the Jaipur Service tax authorities and Office of the Comptroller and Auditor General of India for the period till September 2009. The noticee has been declaring all the credit availed by it in its half yearly returns filed with the service tax authorities and have not received any SCN rejecting the credit so availed. Accordingly, once the credit is validly taken by the noticee, then the benefit is available to the noticee without any limitation in time (i.e. is indefeasible) and can be validly utilized by the noticee to discharge its future service tax liability. Moreover, it is a settled principle of law that Cenvat Credit is a substantive right which cannot lapse unless specifically provided in the law and can be utilized at any point in time." 13.1 Further, we find that in the case of Central Bank of India (supra), Principal Bench of the Tribunal has held as under: "6. After hearing both the sides at length and going through the material available on record, we are of the view that appellant ....