9911796707
TMI Blog2019 (3) TMI 1510X X X X Extracts X X X X X X X X Extracts X X X X ..... acturing activity as well as providing output service, it can be seen that services of sale of shares was consumed by the appellant for raising the capital. The definition of input services includes the services of ‘financing’. Thus, the services consumed for financing or availment of loan will be input service for an assessee who is providing output service or engaged in manufacture of dutiable final product. The period of dispute is prior to 1.4.2011. During the said period, the definition of input services had a wide ambit as it included the words “activities relating to business” - The Tribunal in the case of Hinduja Global Solutions Ltd. Vs. Commissioner of Central Excise, Bangalore [2016 (3) TMI 401 - CESTAT BANGALORE] has categori ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... h Management Limited, Mumbai for services provided in connection with private placement of shares of Technip India Ltd. on account of termination of Joint Venture. It was the view of the department that the said input services availed for sale of shares has no nexus with the manufacturing activity or output services provided by the appellant. Show cause notices were therefore issued proposing to disallow the credit and to recover the same along with interest and for imposing penalties. After due process of law, the original authority confirmed the demand, interest and imposed penalties. Aggrieved, the appellants are before the Tribunal. 2.1 On behalf of the appellant, ld. counsel Shri M.N. Bharathi submitted that in the year 1991 92, t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... se agencies on which the appellant had taken CENVAT credit. Since these services were used for raising capital / funds, they qualify as input services. 2.2 Appellants have utilized the input services for providing output services. The adjudicating authority has failed to appreciate that the services received in connection with the sale of shares of joint venture companies are essentially an input service and that they are eligible to avail credit in terms of the definition of input service . Rule 2(1) of the Cenvat Credit Rules 2004 reads as follows : 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 i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... by the appellants will not fit into the definition of business which is not in order. The adjudicating authority without considering the detailed submissions made by the appellants in their proper perspective has wrongly come to a conclusion that disposal of shares is not a business activity but it is towards generation of wealth. The appellants have contended that the divestment of shares was necessitated out of business expediency. Appellant places reliance on Hinduja Global Solutions Ltd Vs. CCE, Bangalore 2016 (42) S.T.R.932 wherein it has been held that if the assessee pays service tax for various services received by them for raising finances, CENVAT Credit can be availed on the said services as they are directly related to expansio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f raw materials viz. raw naptha and furnace oil to the fertilizer factory. Thus, the sale of shares were used for manufacturing activity and therefore not eligible for credit. The input services do not have any nexus with the output services provided by appellant and therefore the credit availed by appellant is ineligible. 4. Heard both sides. 5. The question is the eligibility of credit on the services availed for sale of shares. Undisputedly, the appellant is engaged in manufacturing activity as well as providing output service. One of the allegations of the department is that credit cannot be availed on the service tax paid as the services availed for sale of shares since the products manufactured by the appellant are exempted. The ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
