2010 (10) TMI 1043 - HC - Indian Laws

Summary

Issues involved: The denial of Cenvat Credit for service tax paid for installation and commissioning of windmill, denial of Cenvat Credit for service tax towards up front fees for obtaining a loan, and the determination of whether services obtained for installation of windmill and procuring a loan qualify as input services under Rule 2(l) of Cenvat Credit Rules, 2004.

Denial of Cenvat Credit for installation and commissioning of windmill: The appellant filed a Tax Appeal under Section-35G of the Central Excise Act, 1944 challenging the denial of Cenvat Credit of service tax paid for the installation and commissioning of a windmill. The substantial question of law raised was whether the denial of Cenvat Credit under Rule 2(l) of Cenvat Credit Rules, 2004 was correct. The advocate for the appellant pointed out a similar issue in a previous appeal admitted by the Court. The Court admitted the appeal and framed the questions of law for determination and consideration.

Denial of Cenvat Credit for up front fees for obtaining a loan: Another issue raised in the appeal was the denial of Cenvat Credit for service tax paid towards up front fees for obtaining a loan for the purchase of a windmill. The question was whether the denial of Cenvat Credit under Rule 2(l) of Cenvat Credit Rules, 2004 was correct. The advocate for the appellant highlighted a similar issue in a previous appeal admitted by the Court. The Court admitted the appeal and framed the questions of law for determination and consideration.

Classification of services as input services: The third issue raised in the appeal was whether the services obtained for the installation of a windmill and for procuring a loan for such windmill qualify as input services under Rule 2(l) of Cenvat Credit Rules, 2004. The Court admitted the appeal and formulated the questions of law for determination and consideration. Notice was issued to the other party, and an additional paper book was directed to be filed within three months for further proceedings. The appeal was to be heard along with another related Tax Appeal.