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2019 (12) TMI 528 - AT - Central ExciseCENVAT Credit - unit is availing benefit of refund of excise duty in terms of N/N. 39/2001-CE availed by the grinding unit where duty is paid through PLA (Cash) - input service distribution - credit of clinker unit denied on the ground that the invoices were billed in name of Grinding unit - HELD THAT - The analogy cannot be agreed upon that credit is not available as the goods during the material time were cleared under the exemption Notification No. 39/2001 CE dt.31.07.2001. Once the exemption benefit stands surrendered by the Appellant they are eligible for the benefits available to them. Even otherwise we find that there is no bar to avail cenvat credit on input and input services if the goods are being cleared under the exemption supra. Further the exemption benefit was only to the extent of refund of duty paid in cash and hence there is no reason to label the goods as exempted goods. The units availing the exemption in question were very much eligible to avail credit - Credit allowed. CENVAT Credit - port services - denial on the ground that the Appellant has not explained whether the said input service is in respect of ship or goods - HELD THAT - The registration requirement was only procedural and could not be made ground to deny credit distribution. Even otherwise also the Appellant unit has taken registration for input service distribution w.e.f 21.02.2008 - even for the subsequent period the Appellant unit was allowed credit by the revenue in adjudication proceedings and the revenue did not challenged said findings. Further when the grinding unit has surrendered the benefit under Notification No. 39/2001 - CE, there is no reason to deny credit to the Appellant unit in terms of Rule 7 of Cenvat Credit rules, 2004 - credit allowed. CENVAT Credit - input services - port service, wharfage - dredging services - Misc. services - nature of service not known - manpower service in respect of Jetty - denial of manpower service on the ground that not available as it has got no connection with the manufacture of final product - telephone and mobile services - denial on the ground that it cannot be established that the mobile phone are used for manufacturing operations conducted by clinker unit and the landline phones installed in head office and other places are used in manufacture and clearance of final products of clinker unit - repair and maintenance services - HELD THAT - The issue in no more res-integra in the light of Hon ble Apex Court judgment in case of Maruti Suzuki Ltd. M/S. MARUTI SUZUKI LTD. VERSUS COMMISSIONER OF CENTRAL EXCISE, DELHI-III 2009 (8) TMI 14 - SUPREME COURT and Hon ble High Court judgment in case of CCE, NAGPUR VERSUS ULTRATECH CEMENT LTD., 2010 (10) TMI 13 - BOMBAY HIGH COURT and M/S. COCA COLA INDIA PVT. LTD. VERSUS THE COMMISSIONER OF CENTRAL EXCISE, PUNE-III 2009 (8) TMI 50 - BOMBAY HIGH COURT wherein it has been held that all activity related to business are covered under the definition of Input Service. There is no dispute about the fact that all the impugned services has been used for business activity of Appellant and hence, we do not find any reason to deny credit - credit allowed. CENVAT Credit - input services - GTA services received for transportation of clinker from clinker unit to grinding unit - outward transportation - benefit of abatement under N/N. 32/2004 ST dt. 31.12.2004 - HELD THAT - Credit allowed relying on the decision in the case of M/S SANGHI INDUSTRIES LTD. VERSUS C.C.E. KUTCH (GANDHIDHAM) 2019 (2) TMI 1488 - CESTAT AHMEDABAD - credit allowed. CENVAT Credit - input services - dredging service - denial on the ground that it has no connection with manufacture of final products - HELD THAT - The same was in respec of jetty in the factory premises and is used for transportation as well as import and export of goods. Since the services are related with the business of the company, the Appellant are eligible to avail credit of the same - Credit allowed. CENVAT Credit - manpower services - operation and maintenance services received for Power Plant - denial on the ground that power plant is situated outside the factory premises and the power so produced is supplied not only to clinker unit but also to grinding unit and residential colonies of Appellant and office - HELD THAT - Credit is allowed placing reliance in the case of COMMISSIONER OF CENTRAL EXCISE AND CUSTOMS, AURANGABAD VERSUS ENDURANCE TECHNOLOGY PVT LTD 2015 (6) TMI 82 - BOMBAY HIGH COURT - credit allowed. CENVAT Credit - input services - Inspection of cement, sampling and analysis work for cement, clinker cement testing, cement packing loading work, cement stevedoring and cargo handling work, cement vessel operation at Kandla and wharfage and DLB Charges, Advertisement of cement in print media are related to grinding unit - HELD THAT - Credit allowed placing reliance in the case of C.C.E. INDORE VERSUS M/S. KRITI INDUSTRIES (I) LTD. 2017 (1) TMI 382 - CESTAT NEW DELHI - credit allowed. CENVAT Credit - credit denied in respect of service tax paid by the service provider which is more than prescribed 10.2% - HELD THAT - The assessment at the end of the service provider has not been challenged. The Appellant has paid the amount of service tax charged to them. In such case, the credit cannot be denied to them - Credit allowed. Appeal allowed - decided in favor of appellant.
Issues Involved:
1. Denial of Cenvat credit due to invoices billed in the name of the Grinding unit. 2. Ineligibility of Cenvat credit on port services. 3. Unavailability of credit on miscellaneous services and manpower services related to Jetty. 4. Non-admissibility of credit on telephone and mobile services. 5. Ineligibility of credit on repair and maintenance services. 6. Denial of Cenvat credit on GTA services for outward transportation. 7. Inadmissibility of credit on dredging services. 8. Unavailability of credit on manpower services for the Power Plant. 9. Denial of credit on services related to cement inspection, sampling, analysis, and advertisement. 10. Excess service tax credit availed beyond the prescribed limit. Detailed Analysis: 1. Denial of Cenvat Credit Due to Invoices Billed in the Name of the Grinding Unit: The Tribunal concluded that the denial of Cenvat credit on the grounds that the invoices were billed in the name of the Grinding unit was incorrect. The Tribunal emphasized that the services were common to both units and that the distribution of Cenvat credit was permissible under Rule 7 of the Cenvat Credit Rules, 2004. The Tribunal cited the Hon'ble High Court judgment in ECOF Industries Pvt. Ltd. and other precedents to support this view. 2. Ineligibility of Cenvat Credit on Port Services: The Tribunal found that the port services, including wharfage and dredging services, were used for the business activities of the appellant, including export activities. The Tribunal held that these services qualify as input services and are eligible for Cenvat credit, referencing judgments such as Reliance Industries Ltd. and Coca Cola India Pvt. Ltd. 3. Unavailability of Credit on Miscellaneous Services and Manpower Services Related to Jetty: The Tribunal determined that the miscellaneous services and manpower services related to the Jetty were indeed connected to the business activities of the appellant. Thus, these services qualify as input services eligible for Cenvat credit. 4. Non-Admissibility of Credit on Telephone and Mobile Services: The Tribunal held that the telephone and mobile services used for business purposes are eligible for Cenvat credit. The Tribunal referenced judgments like Excel Crop Care Ltd. and Ultratech Cement to support this conclusion. 5. Ineligibility of Credit on Repair and Maintenance Services: The Tribunal found that repair and maintenance services used for business activities are eligible for Cenvat credit. The Tribunal referenced several judgments, including Endurance Technology Pvt. Ltd., to support this view. 6. Denial of Cenvat Credit on GTA Services for Outward Transportation: The Tribunal allowed Cenvat credit on GTA services for outward transportation, citing the appellant's own case and other judgments like Ambuja Cements Ltd. and Sanghi Industries Ltd. 7. Inadmissibility of Credit on Dredging Services: The Tribunal concluded that dredging services related to the business activities of the appellant, including import and export of goods, are eligible for Cenvat credit. 8. Unavailability of Credit on Manpower Services for the Power Plant: The Tribunal found that manpower services for the Power Plant, which is related to the business activities of the appellant, are eligible for Cenvat credit. The Tribunal noted that the appellant had already reversed the credit proportionate to the power supplied to the residential colony, which was deemed sufficient compliance. 9. Denial of Credit on Services Related to Cement Inspection, Sampling, Analysis, and Advertisement: The Tribunal held that services related to cement inspection, sampling, analysis, and advertisement qualify as input services and are eligible for Cenvat credit. The Tribunal cited judgments such as Coca Cola India Pvt. Ltd. and Dynamic Industries Ltd. 10. Excess Service Tax Credit Availed Beyond the Prescribed Limit: The Tribunal found that the appellant was eligible for the Cenvat credit on the service tax paid, even if it exceeded the prescribed limit, as the assessment at the service provider's end was not challenged. Conclusion: The Tribunal allowed all the appeals filed by the appellant, Sanghi Industries Ltd., granting consequential reliefs. The appeal filed by the revenue regarding disallowing credit on dredging services was dismissed due to the monetary limit being below the Government's Litigation Policy threshold.
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