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TMI Blog2014 (10) TMI 676X X X X Extracts X X X X X X X X Extracts X X X X ..... No. 21307/2014 - Dated:- 18-7-2014 - SHRI S.K. MOHANTY, J. For the Appellant : Mr. Ashok Deshpande, Advocate For the Respondent : Mr. A. K. Nigam, Addl. Commissioner (AR) JUDGEMENT Per : S.K. MOHANTY; Denial of Cenvat credit on input services is the subject matter of present dispute. In the initial round of adjudication proceedings, Cenvat credit of ₹ 3,62,61,032/- was disallowed by the adjudicating authority. The de novo adjudication was completed pursuant to the Order dated 21.03.2013 of this Tribunal, wherein ₹ 45,50,574/- was disallowed as Cenvat credit by the adjudicating authority vide the impugned order dated 20.03.2014. Out of the said amount, the applicant has accepted ₹ 32,82,878/- as ineligible credit, and consequently, reversed the same. The present appeal is in context with denial of credit of ₹ 12,67,696/-, which according to the appellant is eligible for Cenvat credit, since the disputed services are confirming to the definition of input service as contained in Rule 2(l) of the Cenvat Credit Rules, 2004.The reasons assigned in the impugned order for disallowance of Cenvat credit are that the utilization of services ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tor Service: The Appellant submits that they are very much dependent on the IT infrastructure and require the cable operator service for the cabling of the network server for efficient and fast internet networking. (ix) Commercial Training: Expenses incurred on the employees for various training programme for higher technical knowledge required to operate and run the refinery. Coaching and training are explicitly covered in the definition of eligible input services. (x) Renting of immovable property: Expenses towards rent for the Bangalore office premises. (xi) Subscription to Periodicals: Payment of subscription of various technical magazines and periodicals for the company which are required for running the refinery. (xii) Vehicle Repair: Minor repairs of company vehicles. The learned Advocate appearing for the appellant submitted that the expression such as used in the second part of the definition of the input service is illustrative in nature and not exhaustive and merely gives an indication as to what are the activities, that will normally meet the requirements of the phrase 'activity relating to business'. According to the learned Advocate, merely ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is not practically possible to specify each and every activity of business in the definition clause, for which, the words 'such as' have been used, meaning thereby that the list provided therein is only illustrative and not exhaustive. In the case of Commissioner of Central Excise, Nagpur - Vs. - Ultratech Cement Ltd., reported in 2010 (260) ELT 69 (Bom.), the Hon'ble Bombay High Court has discussed the meaning of 'such as' in context with the definition of 'input service', the relevant paragraphs of which are extracted below:- 35. The argument of the Revenue, that the expression such as in the definition of input service is exhaustive and is restricted to the services named therein, is also devoid of any merit, because, the substantive part of the definition of input service as well as the inclusive part of the definition of input service purport to cover not only services used prior to the manufacture of final products, subsequent to the manufacture of final products but also services relating to the business such as accounting, auditing..... etc. Thus the definition of input service seeks to cover every conceivable service used in the busines ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the purpose of business. For smooth functioning of the business of manufacturing/marketing and other like activities, the manufacturer may open offices/establishments elsewhere, than in the factory of manufacture of the final product. In such an eventuality, it cannot be said that the function of those offices are not in relation to the business of manufacturing the final product. On perusal of the definition of 'input service', it would transpire that the substantive part covers services used directly or indirectly, in or in relation to manufacture of final product; whereas, the inclusive part covers various services used in relation to the business of manufacturing the final product. In other words, the services envisaged in the inclusive part of the definition is very broad and a narrow interpretation cannot be placed to infer that the services used only in the manufacture of final product will qualify as 'input service' for the purpose of taking Cenvat credit. The Hon'ble Bombay High Court in the case of Coca Cola India Pvt. Ltd. - Vs. - Commissioner of Central Excise, Pune - III [2009 (242) ELT 168 (Bom.)], while conveying the true meaning of the phrase &# ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed above in context with the definition of 'input service' is that the definition is exhaustive and is not confined to the services itemized therein after the phrase such as ; rather the said definition takes within its ambit every possible service used by the manufacturer in the business of manufacturing the final product. It has been ruled that the term 'business' in context with the definition of 'input service' cannot be given restricted definition to say that business of manufacturer is to manufacture final product only. 4.2 The nature, purpose and use of the disputed services by the appellant as explained in the grounds of appeal (referred supra), to my opinion, establish the fact that the expenditure incurred for those services are commercially required to be incurred with a view to facilitate the carrying on the business of manufacture, and thus, confirming to the expression 'activities relating to business' as contained in the definition clause of 'input service'; as the word 'business' is one of wide import and in fiscal statutes, it must be construed in a broad rather than a restricted sense. For example, the air travel ..... X X X X Extracts X X X X X X X X Extracts X X X X
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