Misuse of CENVAT Credit on capital goods - availing of CENVAT Credit on towers and parts thereof such as angles, channels, Beam of steel etc., and prefabricated shelter/PUF panels by cellular phone service providers - reg. - Service Tax - F.No.137/315/2007-CX.4

Misuse of CENVAT Credit on capital goods - availing of CENVAT Credit on towers and parts thereof such as angles, channels, Beam of steel etc., and prefabricated shelter/PUF panels by cellular phone service providers - reg. F.No.137/315/2007-CX.4 Government of India Ministry of Finance Department of Revenue Central Board of Excise Customs Dated : February 26, 2008 Sub: Misuse of CENVAT Credit on capital goods - availing of CENVAT Credit on towers and parts thereof such as angles, channels, Beam of steel etc., and prefabricated shelter/PUF panels by cellular phone service providers - reg. It has been brought to the notice of the Board that telecom operators are availing Cenvat Credit on goods like angles, channels, beams, which are used for building transmission towers. Similarly, Cenvat Credit is also being availed on pre-fabricated building, shelters, PUF panels, etc., used for housing/storage of generating sets and other equipments. It appears that the telecom operators claim these items to be 'inputs' for providing telecom services. 2. The issue has been examined; the items mentioned above are used for erecting towers, and making housing/storage units. Thus, these goods are used in making products that cannot be called as excisable goods, being attached to earth, and are not chargeable to excise duty. The items such as angles, channels, beams, etc., are this inputs for civil structures and as such, are not used for providing taxable service. Therefore, it is the considered view of the Board that credit of duty paid on such items is not available to the telecom service providers. 3. In this regard, the undersigned is directed to state that such irregularly Availed Credit on this Account must be recovered expeditiously, within the current financial year. Compliance/difficulty faced in recovering such irregularly availed credit, if any, may be reported to Board, by 15th March, 2008. (Gautam Bhattacharya) Commissioner (Service Tax) CBEC, North Block New Delhi