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TMI Blog2017 (12) TMI 151X X X X Extracts X X X X X X X X Extracts X X X X ..... een clarified that the said services being provided in the inclusive part of definition of input service are definitely eligible to credit. A harmonious reading of the inclusive part of the definition and the exclusion clause mentioned at clause (a) relating to construction service of the definition of input service, it is clear that the construction service relating to modernization, renovation and repair of the factory continued to be within the meaning of input service and accordingly, the Service Tax paid on such service is eligible to credit. Appeal allowed - decided in favor of appellant. - E/13215/2014 - A/13513/2017 - Dated:- 8-11-2017 - Dr D. M. Misra, Member (Judicial) For the Appellant : Shri Anand Nainavati, Advoca ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ce brought into from 01.4.2011. He submits that even though the word setting up had been deleted from the definition input service but the words modernization, renovation and repair of the factory continued to be in the said definition even after 01.4.2011. He submits that exclusion clause inserted with effect from 01.4.2011 should be read in the context while interpreting the applicability of exclusion clause. The Ld Advocate submits that the construction service excluded from the scope of input service be limited to new construction required in setting up of a factory, however, cannot be made applicable to activities relating to repair, renovation and modernization of the existing factory building, plant and machinery. In support, the Ld ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nd repair work within the factory is eligible to credit. Before scrutiny of the rival contentions, the relevant old and amended Rule 2(l) of the Cenvat Rules 2004 are reproduced as below: Prior to 01.4.2011 (l) input service means any service,- (i) used by a provider of taxable service for providing an output service; or (ii) used by the manufacturer, whether directly or indirectly, in or in relation to the manufacture of final products and clearance of final products upto the place of removal, and includes services used in relation to setting up, modernization, renovation or repairs of a factory, premises of provider of output service or an office relating to such factory or premises, advertisement or sales prom ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r referred as specified services) in so far as they are used for - (a) construction or execution of works contract 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) [services provided by way of renting of a motor vehicle], in so far as they relate to a motor vehicle which is not a capital goods; or [(BA) service of general insurance business, servicing, repair and maintenance, in so far as they relate to a motor vehicle which is not a capital goods, except when used by - (a) a manufacturer of a motor vehicle in respect of a motor vehicle manufactured ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... definitely eligible to credit. Thus, harmonious reading of the inclusive part of the definition and the exclusion clause mentioned at clause (a) relating to construction service of the definition of 'input service', it is clear that the construction service relating to modernization, renovation and repair of the factory continued to be within the meaning of input service and accordingly, the Service Tax paid on such service is eligible to credit. Undisputedly, the appellant carried out modernization/renovation work to meet USA FDA guidelines for manufacture of their products therefore, the service tax paid on such construction service is eligible to credit. In the result, the impugned order is set aside and the appeal is allowed wit ..... X X X X Extracts X X X X X X X X Extracts X X X X
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