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TMI Blog2021 (4) TMI 306X X X X Extracts X X X X X X X X Extracts X X X X ..... are for consideration before the Hon ble Apex Court. We find that there is no judgement passed by the jurisdictional High Court on this issue. However, we find that Larger Bench of the Tribunal in the case of Tower Vision India Pvt Ltd Vs CCE [ 2016 (3) TMI 165 - CESTAT NEW DELHI (LB) ] has deliberated the issue at length and decided that credit is not admissible. We are of the considered opinion that we are bound by the judgement of the larger Bench. Extended period of Limitation - HELD THAT:- In the instant case, demand pertains to period 10.9.2004 to 30.09.2006. Show cause Notice has been issued on 06.07.2009, which is clearly beyond the period of limitation - There was difference of opinion between members of CESTAT. The issue was referred to Larger Bench. It clearly indicates that the issue involved is of interpretation of a question of Law and therefore, mala fides cannot be attributed. The appellants submitted that they have been regularly filing returns - Hon ble High Court of Karnataka MTR Foods Ltd [ 2012 (10) TMI 165 - KARNATAKA HIGH COURT ] held that under such circumstances, extended period cannot be invoked. While upholding the Revenue stand on merits, the appeals ar ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... (k)(ii) of Cenvat Credit Rules, 2004 would cover all the goods used for providing any output service except those which are specifically excluded in the said Rule. Thus, even the capital assets which are used for providing any output service will be covered under the term all goods mentioned in 2(k) (ii). The antennas which are essential for the provision of telecommunication service have to be installed at the top of the towers for transmitting mobile signals into atmosphere. The pre-fabricated shelters and panels are used for installation of transmission devices, DG sets and other electrical and electronic instruments. It serves as a junction box. No output service could be provided without the pre-fabricated shelters. 2.2. Learned Counsel for the appellants submits that towers are in the nature of movable property as: It is submitted that angles, channels and other parts used to construct towers or shelters or affixation of towers are obtained in Completely Knocked Down (CKD) condition. At the site, they are bolted and placed on a platform either on the ground or on top of a building to ensure that there is no vibration to the tower. The same can be dismantled again and moved to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... td v. Commissioner of Central Excise, Delhi 2016 (42) STR 249 (Tri-LB). It is a settled position that when a matter is referred to Larger Bench, to resolve conflict of opinion, extended period of limitation is not invokable. The instant proceeding is completely barred by limitation and various decisions based on same set of facts, have categorically held that extended period could not have been invoked in such cases. Reliance is placed in Appellant s own case, Bharti Airtel Ltd v. Commissioner of Central Excise, Guwahati, Shillong Kolkata 2018-TIOL-4061-CESTAT-KOL, wherein the Hon ble CESTAT Tribunal, Kolkata held that extended period of limitation is not invokable since the availability of credit on tower and tower materials, is contingent upon a question of law involving interpretation of complex legal provisions. Similar view has been taken in the Appellant s own case by the Hon ble CESTAT Tribunal, Chennai (Bharti Airtel Ltd. Ors v. Commissioner GST 2018-VIL-193-CESTAT-CHE-ST) as well as Hon ble CESTAT Tribunal, Chandigarh (Bharti Airtel Ltd. OrsVs. CST, Chandigarh-1 - 2017-TIOL-4081- CESTAT-CHD). Hon ble High Courts/Tribunals have consistently set aside such demands barred by ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dently in the light of the facts of the case. We find that Hon ble High Court of Bombay in the appellant s case themselves has held that credit is not admissible on the above. Hon ble High Court has dealt the matter in an elaborate manner going through the definitions of Capital Goods Inputs etc. and the CENVAT Credit Rules. We find that Hon ble High Court has held as follows: 31 . In the light of the aforesaid discussion we examine whether on the rules as they stand the appellants would be entitled to the credit of the duty paid on the item in question on the output service namely the cellular service. We may observe that a plain reading of the definition of capital goods as defined under Rule 2(a)(A) of the Credit Rules show that all goods falling under Chapter 82, Chapter 84, Chapter 85, Chapter 90, Heading No. 6805, grinding wheels and the like, and parts thereof falling under Heading 6804 of the First Schedule to the Central Excise Tariff Act; pollution control equipment; components, spares and accessories of the goods specified at sub-clauses (i) and (ii) which are used either in the factory for manufacture of final products but does not include any equipment or appliance use ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... commonly known as petrol, used in or in relation to the manufacture of final products whether directly or indirectly and whether contained in the final product or not and includes lubricating oils, greases, cutting oils, coolants, accessories of the final products cleared along with the final product, goods used as paint, or as packing material, or as fuel, or for generation of electricity or steam used in or in relation to manufacture of final products or for any other purpose, within the factory of production, and as provided in sub-clause (ii) all goods except light diesel oil, high speed diesel oil, motor spirit, commonly known as petrol and motor vehicles, used for providing any output service. Explanation (2) of sub-rule (k) is also which provides that input include goods used in the manufacture of capital goods which are further used in the factory of the manufacturer. A plain reading of the definition of input indicates that in the present context, clause (i) of Rule 2(k) may not be of relevance as same pertains to manufacturing activity and pertains to goods used in relation to manufacture of final product or any other purpose within the factory of production. Sub-clause ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... PFB and printers is defeated by the very wording of the definition of input. In any case towers and PFB are in the nature of immovable goods and are non-marketable and non-excisable . If this be the position then towers and parts thereof cannot be classified as inputs so as to fall within the definition of Rule 2(k) of the Credit Rules. We clarify that we are not deciding any wider question but restricting our conclusion to the facts and circumstances which have fell for our consideration in these appeals. 34 . We therefore find no infirmity or illegality in the findings as recorded by the tribunal in holding that the subject items are neither capital goods under Rule 2(a) nor inputs under Rule 2(k) of the Credit Rules and hence Cenvat credit of the duty paid thereon was not admissible to the appellants. The appeals are devoid of merit and accordingly stand rejected. No orders as to costs. The above decision has been appealed against and is pending before the Apex Court for decision, 2015 (40) STR J229 (SC). 6. On the contrary, Hon ble High Court of Delhi in the case of Vodafone Mobile Services Others, 2019 (27) GSTL 481 (Del.) has taken a contra decision and have held that credit ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ter the meaning and intention of the substantive and the really relevant part of the notification but only indicative thereof. The interpretation put by the authorities on the said word is too narrow and technical defeating the very object of the notification and running counter thereto. Reading the said notification as a whole, it is obvious and clear that a much wider meaning to the word inputs is intended. It is not used as the grammatical equivalent of or otherwise synonymous with the word ingredients . The effort to equate the two would render the notification to a great extent infructuous and nugatory. Indeed, the notification itself clarifies the word (Inputs) to mean : ...any goods falling under Item No. 68. The sum and substance is to enable manufacturers to claim credit for all Tariff Item 68 goods that go into the manufactured product and on which product full duty is being paid. ------------------------------------------------------------------------------------ 64 . C.B.E. C. Circular No. 58/1/2002-CX, dated 15-1-2002,was relied on, to say that the when the final product is considered as immovable and hence, non-excisable, the same product in CKD condition or unassembl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... credit must be determined at the time of receipt of the goods in terms of Rule 4(1) of the Credit Rules. Credit cannot be denied so as long as the goods are used for the provision of the output service. The issue for availment of Cenvat credit came up before the Gujarat High Court in Mundra Ports and Special Economic Zone Ltd. - 2015-TIOL-1288-HC ST = 2015 (39) S.T.R. 726 (Guj.]. The High Court held that assessee would be entitled to input credit for the cement and steel used in the construction of new jetties and other commercial buildings. In the said case, the High Court has observed in paras 7, 8 and 9 as under : 7. It is not disputed that jetty was constructed and input credit was claimed on cement and steel. The aforesaid definition of Rule 2(k) was applicable and Explanation 2 did not provide that cement and steel would not be eligible for input credit. According to learned counsel for the appellant, the appellant is not manufacturer and, therefore, the provisions Explanation 2 of Rule 2(k) would be applicable only to the factory and manufacturer. The appellant is neither having any factory nor he is manufacturer. The appellant is a service provider of port. We need not go ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ly gone through the decision of the Larger Bench of the Tribunal. We do not find that amendment made in Cenvet Credit Rules, 2004 which come into force on 7-7-2009 was clarificatory amendment as there is nothing to suggest in the Amending Act that amendment made in Explanation 2 was clarificatory in nature. Wherever the legislature wants to clarify the provision, it clearly mentions intention in the notification itself and seeks to clarify existing provision. Even, if the new provision is added then it will be new amendment and cannot be treated to be clarification of particular thing or goods and or input and as such, the amendment could operate only prospectively. In our opinion, the view taken by the Tribunal is based on conjectures and surmises as the Larger Bench of the Tribunal used the expression that intention behind amendment was to clarify. The coverage under the input from where this intention has been gathered by the Tribunal has not been mentioned in the judgment. There is no material to support that there was any legislative intent to clarify any existing provision. For the same reason, as mentioned above, the decision of the Apex Court in Sangam Spinners Limited v. U ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... esent case. It is a settled principle of law that entitlement of Cenvat credit is to be determined at the time of receipt of the goods. If the goods that are received qualify as inputs or capital goods, the fact that they are later fixed/fastened to the earth for use would not make them a non-excisable commodity when received. The CESTAT failed to consider the fact in the event antennae and BTS are to be relocated, the assessee also has to relocate the tower and the pre-fabricated shelters, thereby, implying that the towers and the prefabricated shelters, are not immovable property. Therefore, the CESTAT erred in relying upon the decision of the Bharti Airtel (supra). On an appeal, this case is pending before Hon ble Supreme Court for decision 2020 (32) GSTL J150. 7. Chandigarh Bench of this tribunal in the case ofM/s Bharati Airtel, vide final order A/60267-60269/2019 dated 24-02-2019, held that such items are admissible for credit. 8. In view of the above, it is clear that two High Courts have taken a completely contrary opinion in the matter having identical facts as the instant case. Both the decisions are appealed against and admitted and are for consideration before the Hon b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nature i.e. as to the eligibility of Cenvat credit or otherwise on the towers and building and had to be settled in the hands of the High Court. Therefore, the appellant could have entertained a bona fide belief. Hence all the penalties imposed on all the appellants herein are set aside by invoking the provisions of Section 80 of the Finance Act, 1994. In view of the above, following judicial discipline, we find that the appellants have no case on merits. 9. The appellants have also submitted their arguments on the issue of limitation and submitted various case laws in their defense. The appellants have argued that the availability of credit on towers, angles, channels, beams and shelters have always been a subject matter of dispute/litigation and accordingly extended period of limitation is not applicable in cases of such interpretational nature. there was a conflict of opinion on the said issue which was ultimately addressed by Hon ble Larger Bench in Tower Vision India Pvt. Ltd v. Commissioner of Central Excise, Delhi 2016 (42) STR 249 (Tri-LB). It is a settled position that when a matter is referred to Larger Bench, to resolve conflict of opinion, extended period of limitation ..... X X X X Extracts X X X X X X X X Extracts X X X X
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