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2024 (10) TMI 1064 - AT - Service TaxCENVAT Credit of service tax paid - transportation services used for transportation of household goods of its employees - travel/ journeys performed by the employees - services used for transportation, procurement and filling of diesel - Prefabricated buildings used as shelters - Extended period of limitation. CENVAT Credit on services used for transportation of household goods of employees - HELD THAT - It is seen that during the period under dispute, the definition of the term input services was very wide and it covered all the' input services' used in or in relation to the business. Thus, it is observed that CENVAT Credit availed on services used for transportation of household goods of employees, are input services for the appellant and they are eligible for the credit of service tax paid on such transportation services. Similarly, service tax credit availed on transportation services for travel of employees for official purposes like business meets, sales advertisement campaigns, etc., are also meant for furtherance of business. Hence, the CENVAT Credit availed on such services is also eligible as 'input service'. There are no more res integra as the Tribunal, Bangalore in the case M/S. ROBERT BOSCH ENGINEERING BUSINESS SOLUTIONS LTD. VERSUS COMMISSIONER OF CENTRAL EXCISE, CUSTOMS AND SERVICE TAX BANGALORE-LTU 2016 (12) TMI 812 - CESTAT BANGALORE has allowed the credit on such services as input services . CENVAT Credit on travel/journeys performed by employees for business purposes - CENVAT Credit on services used for transportation, procurement, and filling of diesel for DG sets at cell sites - HELD THAT - During the underlying period, the Appellant have outsourced the said activity of performing Operations Maintenance to service providers who were responsible to ensure upkeep of cell site including the DG sets . Diesel is always required for the running the DG sets. Thus, as a part of providing operations maintenance services, the service providers procured, transported and filled diesel in the DG sets to ensure their continuous operation and sustenance of the cell site. On such activity of procurement, transportation and filling, the service providers charged service tax to the Appellant under the head Business Support Services. It is observed that at the cell site, uninterrupted power supply is required to effectively provide telecommunication services to the subscribers - the said services are 'input services' for the Appellant for rendering their output services. In view thereof, the appellant are eligible for the CENVAT Credit availed on these input services . CENVAT Credit on prefabricated buildings used as shelters, treating them as capital goods - HELD THAT - The subject goods i.e., tower materials, shelters of steel structure, etc,. received by the Appellant are accessories to Base Transceiver Station (BTS), which falls under heading Chapter 85 of Central Excise Tariff Act, 1985 (CETA). It is seen that BTS is one of the core parts of the cell site i.e. telecom infrastructure. The main function of BTS is to transmit and receive the global system of mobile communication for transmitting and receiving frequency. Shelters and other components together makes the telecom infrastructure in a workable condition, thus this equipment used for setting up of telecom infrastructure along with BTS becomes accessories to the BTS. Thus, CENVAT Credit on such towers and shelters are admissible to the Appellant under Rule 2(a)(A)(iii) of the CENVAT Credit Rules as an accessory to BTS - the said goods qualify as capital goods eligible for credit to the Appellant, in terms of Rule 2 (a)(A)(i) of the CENVAT Credit Rules. Extended period of limitation - HELD THAT - The suppression of facts or mala fide intent is required to invoke the extended period of limitation. In this case, there is no evidence brought on record to substantiate the allegation of suppression with intention to evade the payment of tax. Accordingly, the extended period of limitation is not invokable in this case. Since, the principal demand itself is not sustainable, the demands of interest and imposition of penalty do not arise and hence the same is set aside. The appeal is allowed.
Issues Involved:
1. Eligibility of CENVAT Credit on services used for transportation of household goods of employees. 2. Eligibility of CENVAT Credit on travel/journeys performed by employees for business purposes. 3. Eligibility of CENVAT Credit on services used for transportation, procurement, and filling of diesel for DG sets at cell sites. 4. Eligibility of CENVAT Credit on prefabricated buildings used as shelters, treating them as capital goods. 5. Invocation of the extended period of limitation for demanding service tax. Issue-wise Detailed Analysis: 1. CENVAT Credit on Transportation of Household Goods: The appellant argued that the services used for transporting household goods of employees were in furtherance of business, as they facilitated the relocation of employees for professional commitments. The Tribunal observed that during the disputed period, the definition of 'input services' was broad, covering services used in or in relation to business. The Tribunal held that such services qualify as 'input services,' allowing the appellant to claim CENVAT Credit. This view was supported by precedents, including Robert Bosch Engg. & Business Solutions Ltd., where similar credits were allowed. 2. CENVAT Credit on Employee Travel for Business: The appellant contended that travel expenses for business purposes, such as meetings and campaigns, were essential for business operations and thus qualified for CENVAT Credit. The Tribunal agreed, noting that such services further the business and are eligible for credit as 'input services.' This conclusion was reinforced by decisions like Zuari Cement Ltd. and Robert Bosch Engg. & Business Solutions Ltd. 3. CENVAT Credit on Diesel-related Services for DG Sets: The appellant outsourced the maintenance of DG sets, which required diesel for uninterrupted telecommunication services. The Tribunal recognized these services as 'input services' necessary for providing output services. It was noted that the service providers charged service tax under Business Support Services, and the appellant was eligible for credit on these services. The Tribunal cited cases such as Idea Cellular Ltd. and Vodafone Essar South Ltd. to support its decision. 4. CENVAT Credit on Prefabricated Buildings as Capital Goods: The appellant argued that prefabricated shelters were part of the passive infrastructure essential for telecommunication services, qualifying them as capital goods. The Tribunal agreed, noting that these shelters are accessories to the BTS, a core component of telecom infrastructure. The Tribunal referenced decisions like Bharat Sanchar Nigam Ltd. and Indus Towers Ltd., which supported the eligibility of such goods for CENVAT Credit under Rule 2(a)(A)(iii) of the CENVAT Credit Rules. 5. Extended Period of Limitation: The Tribunal found no evidence of suppression or mala fide intent by the appellant to justify invoking the extended period of limitation. Consequently, the principal demand was deemed unsustainable, leading to the dismissal of ancillary demands for interest and penalties. Conclusion: The Tribunal set aside the demands confirmed in the impugned order on both merits and limitation grounds. The appellant was deemed eligible for CENVAT Credit on all disputed services and goods, and the appeal was disposed of accordingly.
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