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TMI Blog2016 (4) TMI 103X X X X Extracts X X X X X X X X Extracts X X X X ..... has not been adverted to by it. Thus, having regard to the nature of the use for which these branch offices were taken on rent, we are of the view that the said service clearly qualifies to be covered within the scope of input service as defined in Rule 2(l) of the Cenvat Credit Rules, 2004. Regarding the insurance services perusal of the nature of insurance policies and the risks covered by them make it obvious that these were used in or in relation to the manufacture of the goods and their clearance upto to the place of removal except the insurance policy which insured the goods during their journey from the place of removal onwards. As regards the place of removal, it is no longer res-integra that in respect of goods exported, the port of export is the place of removal The definition of input service clearly states that input services inter alia means any service used by the manufacturer in or in relation to the manufacture of final products and clearance of final products upto the place of removal. Thus the insurance policies except to the extent they cover journey of goods from the place of removal onwards would be covered within the scope of input service. The input cre ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Renting of Immovable Property Service 1,67,42,779/- 87,78,949/ 79,63,830 2 Insurance Services 81,69,087/- 73,79,045/- 7,90,042/- 3 Construction Service 5,64,359/- 5,56,119/ 8240/- 4 Travel Agent Service5,20,445/- 4,81,838/ 38,607/- 5 Interior Decorator Service 1,26,855/- 80,175/ 46,680/- 6 Architect Service 19,776/- 19,776/-0 (b) The rent was paid for the premises used as branch office which assisted in procurement of orders and delivery of goods. The branch offices were also used for provision of erection commissioning and installation service and repair and maintenance service and therefore renting of immovable property service clearly fell within the scope of input service as per the definition given in Rule 2(l) of the Cenvat Credit Rules, 2004. He cited the following judgments in support of his contention: (i) M/s Oracle Granito Ltd. vs. CCE, Ahmedabad - 2013-TIOL-822-CESTAT-AHM ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... echnologies India Pvt. Ltd. vs. CCE - 2013 (31) STR 441 (Tri. Bang.) (ii) General Manager, BSNL vs. CCE - 2015 (39) STR 278 (Tri. Del.) (h) Interior Decorator Service was used for Decoration / renovation of sales office, branch office and show rooms and was therefore clearly input service. The Architect Service was used for planning of renovation, repairs etc. of the factory premises and therefore qualified to be input service. It cited the following judgments in its support. (i) CCE, Bhavanagar vs. Nirma Limited - 2012 (277) ELT 207 (Tri. Ahmd.) (ii) CCE ST, LTU vs. Lupin Ltd - 2012 (285) ELT 221 (Tri. Mum.) (iii) Pepsico India Holdings Pvt. Ltd. vs. CCE - 2012-TIOL-2045-CESTAT-BANG 3. Ld. DR on the other hand essentially reiterated the contents of the impugned order and stated that the insurance services in respect of goods beyond the place of removal would not clearly be eligible for cenvat credit. 4. We have considered the contentions of both sides. The cenvat credit in respect of renting of immovable property was denied on the ground that renting of immovable property service relating only to the office of the factory could be eligible for such c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... transportation upto the place of removal; but excludes services,- (A) specified in sub-clause(p), (zn), (zzl), (zzm), (zzq), (zzzh) and (zzzza) of clause (105) of Section 65 of the Finance Act (hereinafter referred as specified services), in so far as they are used for- (a) Construction of a building or a civil structure or a part thereof; or (b) Laying of foundation or making of structures for support of capital goods, except for the provision of one or more of the specified services; or (B) Specified in sub-clauses (d), (o), (zo) and (zzzzj) of clause (105) of section 65 of the Finance Act, in so far as they relate to a motor vehicle is available as capital goods; or (C)Such as those provided in relation to outdoor catering, beauty treatment, health services, cosmetic and plastic surgery, membership of a club, health and fitness centre, life insurance, health insurance and travel benefits extended to employees on vacation such as Leave or Home Travel Concession, when such services are used primarily for personal use or consumption of any employee; 5. The aforesaid definitions clearly state that input service inter-alia means any service used by provi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... olicy which insured the goods during their journey from the place of removal onwards. As regards the place of removal, it is no longer res-integra that in respect of goods exported, the port of export is the place of removal The definition of input service clearly states that input services inter alia means any service used by the manufacturer in or in relation to the manufacture of final products and clearance of final products upto the place of removal. Thus the insurance policies except to the extent they cover journey of goods from the place of removal onwards would be covered within the scope of input service. 7. The input credit in respect of construction service has been denied on the ground that the same is not related to modernisation, renovation or repair of factory and has no nexus with the manufacturing activity. We find that the construction service in question was used for dismantling of building and construction of storage shed. In this regard we find that as per Rule 2(l) of Cenvat Credit Rules, 2004 input service also includes service in relation to setting up, modernization, renovation or repairs of a factory. In the case of Bellsonica Auto Components India Pvt ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tion of sales and branch offices and show rooms clearly fall under the definition of input service being, inter alia in the nature of modernisation/ renovation or repair of factory or premises of provider of output service or an office relating to such factory or premises, and credit in respect of such services was allowed by CESTAT in the case of CCE, Bhavanagar vs. Nirma Ltd.- 2012 (277) ELT207 (Tri. Ahmd ). 9. In the light of the foregoing analyses, we are of the view that the impugned demand is not sustainable except to the extent of cenvat credit taken on insurance service relating to insurance of goods beyond the place of removal. Accordingly, we allow the appeal except to the extent of demand, interest penalty relatable to the cenvat credit taken on insurance service relating to insurance of goods beyond the place of removal and remand the case to the primary adjudicating authority for denovo adjudication for the limited purpose of recomputation of demand relating to cenvat credit taken on insurance services relating to insurance of goods beyond their place of removal. Needless to say, that the penalty will also have to be recomputed in the light of the recomputed deman ..... X X X X Extracts X X X X X X X X Extracts X X X X
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