9911796707
|
Home
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2021 (11) TMI 1108 - AT - Service TaxCENVAT Credit - scope of input and input service - period prior to as well as after 1-4-2011 - HELD THAT - The definition of Input contained in Rule 2(k) ibid provided that all goods, excepting the excluded category of goods, should be considered as input for the purpose of availment of the Cenvat benefit. On perusal of the case records vis- -vis the definition clause, it is found that the disputed inputs in this case were not falling under the excluded category of goods itemized in the said Rule - the disputed goods utilized by the appellant prior to 1-4-2011 should be considered as Input for availing the benefit of Cenvat credit - this Tribunal in the case of M/s. Millennia Realtors Private Limited (who is also an appellant in this case) 2020 (3) TMI 624 - CESTAT BANGALORE , has extended the Cenvat benefit on the similar inputs availed by the appellant, considering the same as input in terms of the definition provided under Rule 2(k) ibid. Cenvat credit on the input services prior to the period 1-4-2011 - HELD THAT - The definition of Input Service contained in Rule 2(l) ibid provided that activities relating to business should be considered as input service for the purpose of availment of the benefit of Cenvat facility. In this case, the Department has not raised any objection that the appellants had availed the input services for accomplishing their business purpose. Hence, under such circumstances, denial of Cenvat benefit on the input services availed by the appellant prior to the period 1-4-2011 cannot be denied solely on the ground that the disputed services are not categorised as input services. Cenvat credit on the input services for the period after 1-4-2011 - HELD THAT - The definition clause provided under Rule 2(l) ibid clearly provided that any service used by a provider of taxable service for providing an output service should be considered as input service. The definition clause has provided the excluded category of services, which cannot be considered as input service. On careful examination of the case records, it is found that the list of disputed services itemized in the SCNs as well as in the impugned order are not conforming to the excluded category of services finding place in the definition clause. Thus, denial of Cenvat benefit on the disputed services availed by the appellants after 1-4-2011 by the authorities below is not legal and proper and accordingly, the impugned orders are liable to be set aside. The Learned AR submitted that the appellant had not provided any evidence to show that some of the disputed services are used for the construction activities. However, on a query from the Bench as to whether the Original Authority had recorded such findings in the impugned order, he replied negatively. There are no merits in the impugned orders, insofar as the adjudged demands were confirmed on the appellant, holding that they should not be eligible for the Cenvat benefit - appeal allowed.
Issues Involved:
1. Eligibility of Cenvat credit on inputs and input services under Rule 2(k) and Rule 2(l) of the Cenvat Credit Rules, 2004. 2. Applicability of pre-amended and post-amended definitions of "Input Service" under Rule 2(l). 3. Department's objection to the classification of disputed services as "Input" or "Input Services". Issue-Wise Detailed Analysis: 1. Eligibility of Cenvat Credit on Inputs and Input Services: The appellants, engaged in providing various taxable services, availed Cenvat credit on inputs and input services from June 2007 to September 2013. The Department disallowed the credit, arguing that the services did not conform to the definitions of "input" or "input service" under Rule 2(k) and Rule 2(l) of the Cenvat Credit Rules, 2004. The Original Authorities confirmed the Cenvat demand, imposed interest, and penalties, leading to the appellants filing these appeals. 2. Applicability of Pre-Amended and Post-Amended Definitions: The appellants contended that the period of dispute covered both pre-amended and post-amended definitions of "Input Service" in Rule 2(l). They argued that prior to 1-4-2011, the phrase "activities relating to business" included in the definition should cover their input services. Post-1-4-2011, they claimed the definition was broad and inclusive of all services used by a service provider for providing output services, excluding only certain itemized services. The appellants listed various services (e.g., air travel agent services, banking services, brokerage services, building insurance, etc.) and detailed their usage in providing output services, asserting these should qualify as "input services". 3. Department's Objection: The Department maintained that the disputed services did not meet the definitions of "Input" or "Input Services". However, the Tribunal noted that the Department did not object to the fact that no Cenvat credit on inputs was availed after 1-4-2011. The Tribunal confined its analysis to the period before 1-4-2011, finding that the disputed inputs did not fall under the excluded category of goods in Rule 2(k). The Tribunal referenced previous rulings (e.g., M/s. Millennia Realtors Private Limited v. CCE, Bangalore) supporting the appellants' position. For the period before 1-4-2011, the Tribunal found that the definition of "Input Service" included "activities relating to business". Since the Department did not dispute that the services were used for business purposes, the Tribunal held that the Cenvat credit should not be denied. For the period after 1-4-2011, the Tribunal noted that the definition of "Input Service" included any service used by a provider of taxable service for providing an output service, excluding certain specific services. The Tribunal found that the disputed services did not fall under the excluded category and thus should qualify for Cenvat credit. Conclusion: The Tribunal concluded that the impugned orders denying Cenvat credit were not justified. The appeals were allowed in favor of the appellants, with consequential relief as per law. The Tribunal's decision emphasized that the disputed services, both before and after the amendment, should be considered as "input services" eligible for Cenvat credit.
|
