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2019 (5) TMI 1044 - AT - Service TaxCENVAT Credit - input service - Cargo Handling Services - Storage and Warehouse Service - Airport Services under the Head Airport Services by Airport Authority on Civil Work, Cement Laying Work, Floor Tilling Work, etc. - scope of exclusion clause - HELD THAT - The impugned order denying the CENVAT credit mainly relying upon the exclusion clause as provided in Rule 2(l) is not sustainable in law because the input service involved in the present case relates to repair and renovation of the premises of the appellant who is the service provider. Further, the CENVAT credit on repair or renovation is included in the definition of input service as provided in Rule 2(l) - Further, the Board vide its circular dated 29.4.2011 has also clarified the issue that credit on input services used for repair or renovation of a factory or office is allowed. The modernization, renovation or repair of the premises of the service provider has been held to be input service by various decisions of the Tribunal. Further, these input services are essential for maintenance and upkeep of the premises which is used for storing imported goods and to render the service of cargo handling at the customs station. CENVAT Credit - input services - renting of motor vehicles is concerned - HELD THAT - The CENVAT credit on input service relating to servicing of motor vehicle is also not excluded under Rule 2(l)(B) of CCR and therefore, denial of the CENVAT credit is not tenable under law. Credit allowed - appeal allowed - decided in favor of appellant.
Issues:
Appeal against order regarding CENVAT credit wrongly availed. Analysis: The appeal was directed against an order passed by the Commissioner (A) partially allowing the appellant's appeal and remanding the matter for quantification of wrongly availed CENVAT credit. The appellant was providing various output services and was found to have availed CENVAT credit on services excluded from the definition of 'input service'. A show-cause notice was issued proposing recovery of wrongly availed credit, penalty, and interest. The original authority confirmed the demand, interest, and penalty, which was challenged in the appeal before the Commissioner (A). The appellant contended that the impugned order wrongly interpreted the definition of 'input service' and exclusion clause. They argued that the services utilized were not entirely excluded from the definition and cited a Board circular allowing credit for repair and renovation services. The appellant relied on Tribunal decisions supporting their claim that services related to repair, renovation, and modernization qualify as input services. They also argued against the denial of CENVAT credit for renting motor vehicles, citing various Tribunal decisions. The AR defended the impugned order, but the Tribunal found it unsustainable in law. The Tribunal held that the denial of CENVAT credit based on the exclusion clause was unjustified as the services in question related to repair and renovation of the appellant's premises, falling within the definition of input service. The Tribunal referenced the Board circular and Tribunal decisions supporting the inclusion of repair and renovation services as input services. The denial of credit for renting motor vehicles was also deemed untenable, as it did not fall under the exclusion clause of the CENVAT Credit Rules. In conclusion, the Tribunal set aside the impugned order, allowing the appeal of the appellant. The judgment highlighted that the denied input services were recognized as such by previous Tribunal decisions, making the denial of CENVAT credit unjustifiable. The decision was pronounced in open court on 15/05/2019.
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