TaxTMI 
TaxTMI 
2026 (3) TMI 1628
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....e lower appellate authority upheld denial of CENVAT credit amounting to Rs.84,08,342/- availed on erection, commissioning and installation services, consulting engineering services and manpower supply services, used in connection with expansion of manufacturing facilities for production of hydraulic excavators during the period October 2014 to June 2015, along with imposition of penalty, while setting aside the demand of interest. 1.2 The facts briefly stated are that the Appellant is engaged in the manufacture of Dump Trucks and is duly registered with the Central Excise Department. With a view to expanding its manufacturing operations, the Appellant set up an additional facility adjacent to its existing plant for manufacture of Hydraul....
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.... services used directly or indirectly in or in relation to manufacture of final products, except those specifically excluded. 3.3 The Appellant submitted that the services in dispute do not fall within the exclusion clause, which is limited to construction services, civil structures, foundation work, or works contract services, and that erection and commissioning of machinery is distinct from civil construction. 3.4 Reliance was placed on a catena of judicial pronouncements to contend that the word "includes" enlarges the scope of the definition and omission from the inclusive part cannot curtail the ambit of the main definition. 3.5 On limitation, it was submitted that for the disputed period, the normal period under Section 11A w....
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....ion and allied services used for expansion of an existing manufacturing facility is admissible post-01.04.2011, notwithstanding deletion of the phrase 'setting up of a factory' from Rule 2(l) of the CENVAT Credit Rules, 2004? 8. We observe that the primary ground for denial of CENVAT credit by the lower authorities is that the expression "setting up of a factory" was deleted from the inclusive portion of Rule 2(l) of the CENVAT Credit Rules, 2004 with effect from 01.04.2011, and therefore credit on services used for expansion of the manufacturing facility is not admissible. 9. We note that the Appellant has specifically contended that the factory was already in existence and engaged in manufacture of dutiable final products and that t....
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..... - 2022 (56) GSTL 22 (Tri.-Hyd.), Supreme Industries Ltd. - 2020 (373) ELT 97 (Tri.-Ahmd.), Gujarat Chemical Port Ltd. - (2023) 5 Centax 190 (Tri.-Ahmd.), Kelloggs India Pvt. Ltd. - 2020 (7) TMI 414 (CESTAT Hyd.), Piramal Glass Ltd. - 2019 (10) TMI 1032 (CESTAT Ahmd.), Shiruguppi Sugar Works Ltd. - 2019 (3) TMI 667 (CESTAT Bangalore) and Hindalco Industries Ltd. - 2019 (5) TMI 1620 (CESTAT New Delhi). We note that in these decisions it has consistently been held that services used for installation, modernization, enhancement of capacity and expansion of an existing manufacturing facility continue to qualify as input services under the main limb of Rule 2(l), provided they are not covered by the specific exclusions introduced with effect fr....
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....ture and are not specifically excluded, continue to qualify as "input service" under Rule 2(l) even in the post-01.04.2011 regime. Accordingly, we hold that denial of CENVAT credit solely on the basis of deletion of the phrase "setting up of a factory" from the inclusive portion of Rule 2(l) is not legally sustainable in the facts of the present case. The CENVAT credit is therefore admissible on merits to the appellant. Question No (ii) Limitation 15. We find that the period of dispute involved in the present case is October 2014 to June 2015 and the show cause notice was issued on 02.11.2016. The Appellant contends that the demand is barred by limitation under the normal period prescribed under Section 11A(1) as it stood during the r....
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....n. The reasoning adopted in the impugned order on this aspect is therefore legally unsustainable. 17. We observe that the dispute is purely interpretational relating to scope of Rule 2(l). The Hon'ble Supreme Court in Cosmic Dye Chemical v. CCE - 1995 (75) ELT 721 (SC) held that suppression must be wilful and with intent to evade duty. Similarly, in Padmini Products v. CCE - 1989 (43) ELT 195 (SC), it was held that mere wrong interpretation of law does not amount to suppression of facts and extended period cannot be invoked in cases involving bona fide interpretational disputes. 18. We therefore hold that the demand issued beyond one year from the date of availment is barred by limitation. 19. We observe that since the demand fails....