2018 (5) TMI 399 - AT - Central Excise

CENVAT credit - repair and maintenance service used for Windmills located outside the factory - Held that - in the appellant s own case M/s Maharashtra Seamless Ltd. Versus Commissioner of Central Excise, Raigad 2011 (7) TMI 505 - CESTAT, MUMBAI , the CENVAT Credit on the same service has been allowed by this Tribunal, where it was held that the definition of input service read as a whole makes it clear that the said definition not only covers services, which are used directly or indirectly in or in relation to the manufacture of final product, but also includes other services, which have direct nexus or which are integrally connected with the business of manufacturing the final product - credit allowed - appeal allowed - decided in favor of appellant.

Summary

Issues involved:
Availing CENVAT Credit for repair and maintenance service used for Windmills located outside the factory, denial of CENVAT Credit by Revenue, conflicting decisions on the issue.

Analysis:

Availing CENVAT Credit:
The appellants availed CENVAT Credit for repair and maintenance service used for Windmills located outside the factory, with the electricity generated through windmills being used by the appellant. The Revenue denied the CENVAT Credit, leading to a dispute over the eligibility of the credit.

Conflicting Decisions:
The appellant cited favorable judgments in their own case and other cases to support their claim for CENVAT Credit. On the other hand, the Revenue pointed out contrary decisions in other cases to oppose the allowance of the credit. The conflicting decisions created a legal ambiguity that needed resolution.

Tribunal's Analysis:
Upon considering the submissions from both sides, the Tribunal noted that in the appellant's own case, CENVAT Credit on the same service had been allowed previously. The Tribunal examined the definition of input service under the Cenvat Credit Rules, emphasizing services used directly or indirectly in relation to the manufacture of final products. The Tribunal found that the service in question fell under the definition of input service as it was used in the manufacture of final products.

Precedents and Legal Interpretation:
The Tribunal referred to previous judgments and legal provisions to support its decision. It highlighted that there was no legal requirement for input services to be used only within the factory premises, unlike inputs. The Tribunal also cited relevant case laws and rulings to establish the eligibility of the appellant for CENVAT Credit based on the direct nexus between the service and the manufacturing process.

Conclusion:
After detailed analysis and referencing relevant legal principles and precedents, the Tribunal concluded that the appellant was eligible for the CENVAT Credit. The Tribunal upheld its previous judgment in the appellant's own case and dismissed the conflicting decisions cited by the Revenue. The impugned order denying the credit was set aside, and the appeal was allowed in favor of the appellant.

This comprehensive analysis of the judgment showcases the legal intricacies involved in the dispute over availing CENVAT Credit for services used outside the factory premises, highlighting the importance of legal interpretation, precedents, and the specific definitions under the Cenvat Credit Rules.