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TMI Blog2009 (5) TMI 48X X X X Extracts X X X X X X X X Extracts X X X X ..... service' should be limited only to outward transportation upto the place of removal in terms of the inclusive definition as held in the Gujarat Ambuja case cited supra?" 2. Rule 2(1) of the CENVAT Credit Rules, 2004 reads as under:- (i) "input service" means any service, - (ii) Used by a provider of taxable service for providing an output service; or (iii) Used by the manufacturer, whether directly or indirectly, in or in relation to the manufacture of final products and clearance of final products from 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 factor or premises, advertisement or sales promotion, market research, storage upto the place of removal, procurement of inputs, activities relating to business, such as accounting, auditing, financing, recruitment and quality control, coaching and training, computer networking, credit rating, share registry, and security, inward transportation of inputs or capital goods and outward transportation upto the place of removal; 3. The above definition can be conveniently divided into the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ell within any one head of exemption, it would be free from tax notwithstanding that the conditions of another head of exemption are not satisfied and such income is not free from tax under that head of exemption." 7. The same proposition has been laid down by the Apex Court in Share Medical Care v. Union of India [2007 (209) E.L.T. 321 (S.C.)]. The relevant para graphs are reproduced herein below "15. From the above decisions, it is clear that even if an applicant does not claim benefit under a particular notification at the initial stage, he is not debarred, prohibited or estopped from claiming such benefit at a later stage. 16. In the instant case, the ground which weighed with the Deputy Director General (Medical), DGHS for non-considering the prayer of the appellant was that earlier, exemption was sought under category 2 of exemption notification, not under category 3 of exemption notification and exemption under category 2 was withdrawn. This is hardly a ground sustainable in law. On the contrary, well settled law is that in case the applicant is entitled to benefit under two different Notifications or under two different Heads, he can claim more benefit and it is the duty ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the amount calculated at 20% ad valorem. At serial No. 53 of the Table the following goods were covered: "Automatic testing or marking or printing or taping machine or any combination thereof." We find that the goods imported were 'Optical Time Domain Reflectometer' which was specifically covered by the already existing Notification No. 59/88-Cus. The description at Serial No. 53 of the Table under Notification No. 96/91 -Cus. was general in nature and it could not be said that the goods were equally covered by both the notifications. When there is specific entry, it is settled position in law that the goods would be class under that specific entry as against the general entry. 10. The learned Advocate had submitted that the Assistant Collector, Customs had not disputed that the item in question was covered by Serial No. 53 of Notification No. 96/91-Cus. We find that the Assistant Collector, Customs had only referred that entry under Customs Notification No. 96/91- Cus. which was generic in nature and covered broad category of goods of particular nature. We find that he had held that the goods were not covered by Serial No. 53 of Notification No. 96/91-Cus." 9. On appeal by th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... aul (66 C.W.N. 767), Shyam Lal v. M. Shyamlal (A.I.R. 1933 All. 649) and 76 Corpus Juris Secundum 621. Assuming that the investments in shares and in lands do not form part of the undertakings but are different subject matters, even then these would be brought within the purview of the vesting by reason of the above expressions. In this connection, reference may be made to 76 Corpus Juris Secundum at pages 620 and 621 where it is stated that the terms "relate" is also defined as meaning to bring into association or connection with. It has been clearly mentioned that "relating to" has been held to be equivalent to or synonymous, with as to "concerning with" and "pertaining to". The expression "pertaining to" is an expression of expansion and not of contraction. There is no qualification to the word "activities" - there is no restriction that the "activities relating to business" should be relating to only the "main" activities or "essential" activities and, therefore, all other activity relating to business falls within the definition of "input service". 14. The expression "such as" is purely illustrative. The expression means "for example" or "of a kind that" - (Concise Oxford Di ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... arrangements of nature of prize chits but under different names. This decision, however, is not applicable for the purpose of interpreting the definition of "input services" which contains both the expressions "means" and "includes" 17. In this view of the matter, the use of the expression 'outward transportation' in the inclusive clause of the definition is by way of abundant caution so as to avoid any dispute being raised on the "means clause" (which refers to clearance from the place of removal), that transportation upto the place of removal is not available as credit. Transportation within a factory would be covered by the inclusive clause. However, where depot is a place of removal, freight from depot to customer's premises would be covered by the means clause by the expression "service used directly or indirectly or in relation to clearance of final products from place of removal". Similarly, where the factory is the place of removal freight from factory to customer's premises would be covered by the term "service used directly or indirectly, in relation to clearance from place of removal." 18. For admissibility to credit for outward transportation there is no requirement ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he delivery thereof in acceptable condition to the purchaser at his door step; (ii) the seller bore the risk of loss of, or damage to, the goods during transit to the destination; and, (iii) the freight charges were an integral part of the price of goods and in such cases, the credit of service tax paid on the transportation upto such place of sale would be admissible if it can be established by the claimant of such credit that the sale and transfer of property in goods (in terms of the definition under Section 2 of the Central Excise Act, 1944 as also in terms of the provisions under the Sale of Goods Act, 1930) occurred at the said place. 20. The guidelines issued by the Organisation for Economic Co-operation and Development (OECD) also throw some light on the above. The relevant portion from the guidelines is reproduced herein below:- INTERNATIONAL VAT/GST GUIDELINES PREFACE .......... "4 ....In addition, it should be borne in mind that value added tax systems are designed to tax final consumption and as such, in most cases it is only consumers who should actually bear the tax burden. Indeed, the tax is levied, ultimately, on these purchases is, in principle, fully deductib ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and the OECD guidelines. 22. There is an additional reason for holding that CENVAT credit is admissible on services even if the value thereof is not part of the value subjected to duty. This is because the interpretation of the expression "input services" cannot fluctuate with the change in the definition of "value" in Section 4 of the Central Excise Act and cannot vary depending on whether the goods are levied to duty under Section 4A of the Central Excise Act or tariff value under Section 3(2) of the Central Excise Act or the product attract specific rate of duty. In the case of Gujarat Ambuja Cements Ltd. v. Commissioner of Central Excise, Ludhiana [2007 (6) S.T.R. 249 (Tri.) = 2007 (212) E.L.T. 410 (Tri.)] relied upon by the Revenue, the Tribunal had relied on the decision of the apex court in Reserve Bank of India v. Peerless Co. [(1987) 1 SCC 424] to hold that the inclusive clause casts its shadow on the main definition also. The Tribunal also relied upon the decision in E.V. Mathai & Co. v. Commissioner of Central Excise [2006 (3) S.T.R. 116 (Tri.-Bang.) = 2003 (157) E.L.T. 101 (Tri.-Bang.)] and Bhagyanagar Services v. Commissioner of Central Excise, Hyderabad [2006 (4) S. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s 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 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 promotion, market research, storage upto the place of removal, procurement of inputs, activities relating to business, such as accounting, auditing, financing, recruitment and quality control, coaching and training, computer networking, credit rating, share registry, and security, inward transportation of inputs or capital goods and outward transportation upto the place of removal;" 12. The 'input service' has been defined to mean any service used by the manufacturer whether directly or indirectly and also includes, inter alia, services used in relation to inward transportation of inputs or export goods and outward transportation upto the place of removal. It has also remain uncontroverted that for transportation purposes insurance cover has also been taken by the appell ..... X X X X Extracts X X X X X X X X Extracts X X X X
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