TaxTMI 
TaxTMI 
2026 (8) TMI 1074
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....44 (for short 'the Act') the appellant-revenue has proposed the following substantial questions of law arising out of order dated 17.01.2024, passed by the Customs, Excise & Service Tax Appellate Tribunal, West Zone Bench at Ahmedabad (for short the Tribunal') in Service Tax Appeal No. 11273 of 2016-DB: "(i) Whether the impugned Cenvat Credit on goods/services is admissible specially when such goods do not qualify as Inputs/Inputs services/Capital goods under the definition? (ii) Whether the Cenvat Credit is admissible on towers, pre fabricated shelters and parts thereof used for providing Telecommunication service? (iii) Whether the Hon'ble CESTAT, Ahmedabad has failed to interpret the Rule 2(a)(A) of Cenvat ....
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.... Original dated 01.02.2016 found that the respondent is not a manufacturer but a service provider and, therefore, CENVAT credit could not have been availed by the assessee. 6. Being aggrieved by the above mentioned Order in Original, the respondent had preferred an appeal before the Tribunal. The Tribunal, relying on the decision of the Hon'ble Delhi High Court in case of M/s. Vodafone Mobile Services Limited v. CST, Delhi reported in [(27) G.S.T.L. 481 (Del)] held that the respondent-assessee was entitled for CENVAT credit. Being aggrieved by the order passed by the Tribunal, the appellant -revenue has preferred the present Tax Appeal. 7. At the outset, learned Senior Standing Counsel Mr. Deepak Khanchandani for the department has co....
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....inst the revenue in favour of the assessee. 9. Having heard learned Senior Standing Counsel Mr. Khanchandani for the revenue, the issue is no more res integra as the Hon'ble Apex Court in case of M/s. Bharti Airtel Ltd. (supra) decided in Civil Appeal Nos. 10409-10410 of 2014 has held as under: "11.12.3 It may be noted that in the definition of "input" under Rule 2(k) when it relates to providing output service it has been simply defined as all goods, except light diesel oil, high speed diesel oil, motor spirit, commonly known as petrol and the motor vehicles used for providing any output service. However, when the word "input" is defined relating to manufacture of product, it has been defined in a broad and expensive manner to ....
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....ce to providing output service under Rule 2(k)(ii) need not be given a restrictive meaning as sought to be done by the CESTAT by holding that tower is not used directly for transmission of signal. In our view since the subject matter is same, i.e., what amounts to "input" though the end use is for two different products, one tangible, in the form of final manufactured product, and one intangible i.e., output service, applying similar tests to determine what amounts to "input" would not be impermissible. 11.12.4 We have also noted that the Bombay High Court had taken the view that it cannot be said that it is impossible to provide the service without the aid of the towers, thus showing non-dependency of antenna on tower. In....
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....endering of output service of mobile telephony, these items certainly can be considered to be "inputs" akin to antenna. Without the towers and the PFBs, there cannot be proper service of mobile telecommunication. Hence, these certainly would come within the definition of "input" under Rule 2(k) (ii). 11.12.5 What we have noted also is that the CESTAT rejected the plea of the Assessee that towers and parts thereof are inputs under Rule 2(k) by observing that the towers are admittedly immovable structures and hence ipso facto nonmarketable and non-excisable and these do not lead to manufacture of goods and that towers and PFBs certainly are not used for providing mobile services. By relying on Explanation-2 to Rule 2(k) whic....
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....tion services, the inescapable conclusion is that they would also qualify as "inputs" under Rule 2(k) for the purpose of credit benefits under the CENVAT Rules. 11.13 For the foregoing reasons, we agree with the conclusions arrived at by the Delhi High Court and uphold the judgment rendered by it in Vodafone (supra) and dismiss the connected appeals being CA No. 5032-5035 of 2021, CA No. 5039-5040 of 2021, CA No. 5038 of 2021, CA No. 5036-5037 of 2021, CA No. 62 of 2022. 11.14 For the same reasons, we are unable to agree with the view of the Bombay High Court and accordingly, set aside the judgment in Bharti Airtel (supra) rendered by it and allow the connected appeals, being CA No. 10409-10 of 2014, CA No. 7119 of 2015, C....