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TMI Blog2017 (6) TMI 667X X X X Extracts X X X X X X X X Extracts X X X X ..... nd Mr. Devender Singh, Member (Technical) Amrinder Singh, Advocate for the Appellant(s) Sh. Satyapal, A.R. for the Respondent(s) ORDER Appellants are in appeal against the impugned order denying Cenvat Credit availed by the appellants. 2. The facts of the case are that the appellant is providing tele-communication services during the period April, 2007 to May, 2007. The appellants setup BTS mobile towers at various locations in the circle which emit and receive wireless signals to and from between a person availing telephone service. The appellants availed Cenvat Credit of duty paid on various capital goods and also the Cenvat Credit of service tax paid on various input service used for providing the output service. The Revenue alleged that the appellant, in addition to the taxable service in relation to telephone connection are also providing the exempted services of the network access to other telephone service provider (inter connectivity services) for which the concerned telephone service providers are charged IUC charges, Tap ut charges and mobile terminating charges and of permitting the used their infrastructure like BTS towers etc. for other mobile te ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ument of the appellant through wireless signals requests the MSC of that telephone service provider to connect to his subscriber. The appellant have taken credit of Central excise duty, addl. Customs duty paid on various capital goods including those mentioned above and also the credit of service tax paid on various input services used for providing the output services. The Revenue by invoking Rule 6(3)(c) of the Cenvat Credit Rules, 2004 has restricted the utilization of Cenvat Credit for payment of service tax on the output service to 20% of the amount of service tax payable on the ground that the Appellant, in addition to the taxable Service in relation to telephone connection , are also providing the exempted services (as defined under Rule 2(e) of the Cenvat Credit Rules, 2004) of network access to other telephone service providers (inter connectivity services) for which the concerned telephone service providers are charged IUC charges , Tap out charges and Mobile terminating charge and of permitting the use of their infrastructure like BTS towers etc. by other mobile telephone service provides for which they are charged Infrastructure user charge by the Appella ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ture of non-exempt dutiable goods as well as exempted goods the credit will be available; and (c) Tribunal in its judgment in case of CCE, Goa Vs. V.M. Salgaonkar Bros. Pvt. Ltd. (supra) with regard to provisions of Rule 6(3) (c) has held that if an assessee being eligible for some Cenvat service credit takes the credit, he should be allowed to utilize the same, as there is no reason for allowing some credit and not permitting its utilization. And this Tribunal remanded matter back for the verification purpose. We agreed with the observations of this tribunal in the earlier order of this Tribunal. Therefore, the matter is remand back to the Adjudicating Authority for verification purpose as discussed above, thereafter to pass an appropriate order in accordance with law. In case, there is no demand against the appellant in remand proceedings, there will be no penalty against the appellants. With these terms, the appeal is disposed off. (Dictated and pronounced in the open court) Devender Singh Member (Technical) Ashok Jindal Member (Judicial) PER: DEVENDER SINGH The appellants are holding Service Tax R ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... service tax payable on utilization of tax credit for payment of service tax on telephone service is not applicable in respect of capital goods Cenvat credit and service tax credit in respect of 17 input services specified in Rule 6(5). We agree with this plea of the appellant as - (a) In terms of the provisions of sub-rule (4) of Rule 6 of the Cenvat Credit Rules, 2004, capital goods Cenvat credit is not permissible only when the capital goods are exclusively used for manufacture of exempted goods or for providing exempted service , implying that in a situation where the capital goods are used for providing non exempt taxable service as well as exempted service or for manufacture of non exempt dutiable goods as well as exempted goods , the capital goods Cenvat credit shall be available ; (b) In terms of the provisions of sub-rule (5) of Rule 6 of Cenvat Credit Rules 2004, service tax credit in respect of 17 input services specified in this sub-rule shall be available unless such services are used exclusively in or in relation to providing exempted service or manufacture of exempted goods , implying that in a situation when these services are used for pro ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... h a similar provision has been made in sub-rule (4) of Rule 6 and which are also part of fixed assets that cannot be apportioned for maintaining separate records. As per Hon ble Supreme Court s judgment in case of CCE, Bolpur v. Ratan Melting Wire Industries reported in 2008 (12) S.T.R. 416 (S.C.) = 2008 (231) E.L.T. 22 (S.C.), the Board s instructions are binding on the Departmental officers unless contrary view has been expressed by Hon ble Supreme Court or any High Court. In this case neither any such judgment of Hon ble Supreme Court or High Court has been produced, nor the Department has shown as to how the Board s instructions, which are its own instructions, are contrary to statutory provisions. We, therefore, have no hesitation in holding that the word credit in the expression - the provider of output service shall utilize credit only to the extent of... in sub-rule (3)(c) of Rule 6 does not include the capital goods credit and the service tax credit in respect of 17 services referred to in sub-rule (5) and accordingly the ceiling of 20% of the service tax payable on utilization of credit for payment of service tax, as prescribed in Rule 6(3)(c), has to be compa ..... X X X X Extracts X X X X X X X X Extracts X X X X
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