2018 (5) TMI 187 - AT - Central Excise

CENVAT credit - construction service i.e. repair and maintenance of the existing plant and machinery and factory building etc - Held that - services received by the appellant relate to repair and maintenance service of their factory building, which is evident from the sample invoices produced by the appellant - Tribunal in Ion Exchange (I) ltd. case 2017 (12) TMI 151 - CESTAT AHMEDABAD held that the construction service used for repair and renovation of factory even after 01.04.2011 is input service , and service tax paid on such service is admissible to credit - appeal allowed - decided in favor of appellant.

Summary

Issues Involved:
Whether the appellants are eligible to avail Cenvat credit of service tax paid on construction service for repair and maintenance of plant and machinery and factory building.

Analysis:
The judgment delivered by Dr. D.M. Misra, Member (Judicial) of the Appellate Tribunal CESTAT Ahmedabad pertains to two appeals filed against respective Orders-in-Appeals. The central issue in these appeals was the eligibility of the appellants to claim Cenvat credit of service tax paid on construction services for repair and maintenance of plant and machinery, as well as the factory building. The appeals were heard together as they involved a common issue.

During the proceedings, the appellant's advocate presented a list of input invoices detailing the nature of construction services received by the appellants. Sample copies of invoices were also provided to support the claim that the construction work undertaken was related to the repair and maintenance of plant and machinery, and the factory building. The advocate relied on a previous decision of the Tribunal in the case of Ion Exchange (I) Ltd. Vs. CCE, Surat-II to bolster their argument.

On the other hand, the Revenue's representative reiterated the findings of the Commissioner (Appeals) during the hearing. After considering the arguments and evidence presented by both sides, Dr. D.M. Misra found that the services received by the appellant were indeed related to the repair and maintenance of their factory building, as evidenced by the sample invoices submitted. Referring to the precedent set in the Ion Exchange (I) Ltd. case, the Tribunal concluded that the construction services used for repair and renovation of the factory were considered as 'input services'. Therefore, the service tax paid on such services was deemed admissible for credit.

Consequently, the impugned order was set aside, and the appeals were allowed with any consequential relief as per the law. The judgment was dictated and pronounced in open court, bringing clarity to the issue of Cenvat credit eligibility for construction services related to repair and maintenance activities.