9911796707
TMI Blog2022 (11) TMI 1070X X X X Extracts X X X X X X X X Extracts X X X X ..... ashmir . Again, as per Section 64 of the Finance Act, 1994, the Act extends to the whole of India except the State of Jammu Kashmir. Thus, there is no levy of service tax on the services provided in Jammu Kashmir. The Department has construed or rather confused the services rendered in Jammu Kashmir to be exempted services. Sub-clause (2) of Rule 6 of Cenvat Credit Rules, 2004 speaks about the situation when the service provider is rendering output services which are chargeable to tax as well as exempted services. The services rendered in Jammu Kashmir are not chargeable to service tax and therefore, are not taxable services. But this does not make them exempted services also. A service becomes an exempted service when by notific ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ORDER The present appeal is filed by the department against Order-in-Original No. VAD-EXCUS-002-COM-029-15-16 dated 02.02.2016 passed by the Commissioner of Central Excise Service Tax. 1.2 Briefly stated the facts of the case are that from the audit of records of M/s Alstom Projects India Ltd. (now known as M/s Alstom India Ltd.) for the period January 2010 to June 2010, it appeared that the respondent had provided Erection, Commissioning and Installation Services to M/s National Hydroelectric Power Corporation Ltd., Uri, Jammu and Kashmir (i.e. M/s NHPC) without payment of any service tax, as the provisions of Chapter V of the Finance Act, 1994 were not applicable to the State of Jammu and Kashmir. However, it appears that ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... re, the provisions of Cenvat Credit Rules, 2004 are clearly applicable to the facts of the present case. As per the definition of exempted services as provided under the Rule 2(e) of the CCR-2004, not only includes taxable services which are exempted, but also services on which no service tax is leviable under Section 66 of Chapter V of the Finance Act, 1994. In the present case since the services of Erection, Commissioning and Installation which are otherwise taxable, is admittedly not taxable for the simple reason that the same has been provided within the State of Jammu Kashmir. However, that does not take away the character of the same being a service on which no service tax is leviable to be kept outside the definition of exe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r. The service which are performed outside the taxable territory would not qualify under the definition of exempted services as defined in the Cenvat Credit Rules, 2004. Further the definition of exempted services has two portions. The main clause of the definition covers the taxable services which are exempt from the whole of the service tax leviable thereon. In the present matter, clearly the services rendered in J K are not taxable service and there is no specific exemption issued under the Service tax provisions in this regard. Therefore, the said services would not fall in the main clause of the definition. Further, the inclusive clause of the definition covers all such services on which no service tax is leviable. In said leg of the d ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 2)ELT 580 (Guj) Welspum Corp Ltd. Vs. CCE, 2019(368)ELT 179 Bombay Minerals Ltd. Vs. CCE- 2019(29)GSTL 361 (T) CCE Vs. Larsen Toubro Ltd. 2015(39)STR 913 (SC) 4. We have heard both sides carefully and perused the appeal papers. The first issue is whether appellants are liable to reverse the credit availed on common input services used for rendering services in Jammu Kashmir. Undisputedly the appellants have used common input services for providing services in State of Jammu Kashmir and other parts of India. The proviso to sub-clause (2) of Rule 1 of Cenvat Credit Rules states that nothing contained in these rules relating to availment and utilization of credit of service tax shall apply to the State of Jammu and Kashm ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e above provision speaks about the situation when the service provider is rendering output services which are chargeable to tax as well as exempted services. The services rendered in Jammu Kashmir are not chargeable to service tax and therefore, are not taxable services. But this does not make them exempted services also. A service becomes an exempted service when by notification or law, the service tax payable on such service is exempted. Rule 6(2) does not apply to a situation where the service provider renders both taxable services and services which are not subject to service tax. The law is silent in this regard. The Department cannot construe the services provided to Jammu Kashmir as exempted services and press into application, i ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
