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TMI Blog2024 (9) TMI 110X X X X Extracts X X X X X X X X Extracts X X X X ..... ncerned, the only stipulation is that it should be received by the manufacturer of final products. It was held that the decision of the Hon ble Supreme Court in the case of Maruti Suzuki Ltd Versus CCE, Delhi-III [ 2009 (8) TMI 14 - SUPREME COURT] is not applicable in the case of input services - the disallowance of Credit alleging that the Credit has been availed in unregistered premises requires to be set aside. Availment of cenvat credit beyond six months from the date of the document - HELD THAT:- It has to be noted that when duty is paid on inputs and service tax paid on input services a right accrues for availing Credit. All the invoices have been issued prior to September 2014. This means that invoices on which Credit has been availed have been issued before the introduction of the restriction limiting the time for availing the Credit. Nothing in the provision says that the 3 proviso to Rule 4 would have retrospective effect. The very same issue was considered by the Hon ble High Court of Delhi in the case of GLOBAL CERAMICS PVT. LTD., M/S. B.R. CERAMICS (P) LTD. VERSUS THE PRINCIPAL COMMISSIONER OF CENTRAL EXCISE, DELHI-1 [ 2019 (5) TMI 1432 - DELHI HIGH COURT ]. While anal ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... her than their registered factory premises. They also availed house keeping services. 4. The appellant took Cenvat Credit of services tax paid on these services availed for supply of employees to a place other than registered factory premises and utilized the Credit for payment of excise duty on final products. 5. As per rule 2(l) of Cenvat Credit Rules, 2004 Input Service means any service (i) used by a provider of taxable service for providing an output service, or (ii) used by the manufacture, whether directly or indirectly, in or in relation to 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 factory or premises, advertisement or sales promotion, market research, storage upto the place of removal, procurement of inputs, accounting, auditing, financing, recruitment and quality control, coaching and training, computer networking, credit rating, share registry, security, business exhibition, legal services, inward transportation of inputs or capital goods and outward tra ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t. It is submitted that M/s. Autotech Industries (I) Pvt. Ltd. (hereinafter referred to as the appellant ), is engaged in the manufacture of ICP Engines and parts of motor vehicles, and have their registered manufacturing premises at SP-114, SIDCO Industrial Estate, Ambattur, Chennai 600 058. The appellant have un-registered premises at B4, C4, F5, F7, H4 and 51-54 (Athipattu), which are in and around the registered premises. From the registered premises of the appellant, their semi-finished goods are removed to these un-registered premises for undertaking various further processes, such as turning, drilling, grinding, etc. and ultimately the final products are cleared to customers from the registered premises on payment of appropriate duty of excise. Hence, these premises could be treated as the appellant s own job working premises and such units are appellant s own units and not different entities. 9.1 In such job working premises, the appellant availed the services of various manpower supply contractors and house-keeping agencies and the service tax paid on such services availed at the job working units was availed as cenvat credit in the registered premises of the appellant, as ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... said credit of Rs.1,19,41,572/- includes an amount of Rs.1,06,09,387/- covered within the above demand of Rs.2,57,83,373/- and the balance of Rs.13,32,195/- relates to Cenvat Credit on input services received at registered premises. 9.6 Subsequently, another Statement of Demand bearing No. 32/2016 Dated 30.03.2016 has been issued to the appellant, proposing to demand cenvat credit of Rs.73,00,818 availed during March 2015 to February 2016, in respect of the manpower supply and house-keeping services availed in the job work premises, along with proposals for demand of interest and imposition of penalties. The appellant replied to the above notices, vide their replies dated 05.11.2015 and 25.04.2016, respectively. 9.7 After due process of law, the Commissioner of Central Excise, Chennai II passed the impugned common Order in Original bearing Nos. 66 67/2016 Dt. 30.05.2016 wherein he has held that the appellant is not entitled for cenvat credit in respect of the services consumed at the job working unit; he further held that the extended period of demand could be invoked in this case; with regard to the credit availed beyond the prescribed time limit, he has held such credit is not e ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s. CCE, Mumbai 2018 (15) GSTL 66 (Tri. Bom.) Fives Cail KCP Ltd. Vs. CCE, Chennai I 2018 (363) ELT 1082 (Tri. - Mad.) Deepak Fertilizers And Petrochemicals Corporation - 2013 (4) TMI 44 - BOMBAY HIGH COURT Ashok Leyland Ltd. - 2019 (1) TMI 430 - MADRAS HIGH COURT India Pistons Ltd. - 2022 (11) TMI 42 - CESTAT CHENNAI Dakshin Foundry Pvt. Ltd. - 2017 (5) TMI 137 - CESTAT BANGALORE 9.10 Availment of cenvat credit beyond six months from the date of the document: It is the appellant s case that the proposal to deny the credit availed in September 2014, on the ground that the credit was taken beyond six months from the date of invoice is not at all sustainable. Relying upon the decision of the Hon ble Supreme Court in the case of Eicher Motors Ltd. VS UOI - 1999 (106) ELT 3 SC the appellant submits that the benefit of cenvat credit which has been extended to a manufacturer under Rule 3 of the CCR, 2004 cannot be curtailed on the ground of time bar. There was no restriction of time for availing credit prior to 01.09.2014. Following the decision in the case of Eicher Motors Ltd supra, in the following cases, it has been categorically held that credit cannot be denied for the invoices issu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s are not sustainable. 9.14 Accordingly, the appellant prays before the Hon ble Tribunal to set aside the impugned order with consequential relief, and allow these appeals. 10. The Ld. AR Shri M. Selvakumar appeared for the department. 10.1. The first issue is Credit availed on man power supply services and house-keeping services. The appellant has consumed the services in the job working premises and not in the registered premises of the appellant. The definition of input service under Rule 2(l) of CCR, 2004 was referred by the Ld. AR to argue that Input services means any service used by Manufacturer . In the instant case, the input services were not received by the manufacture in his registered premises but were received and used in their un-registered premises. The basic requirement of Rule 3(1) of CCR, 2004 has not been complied. 11. Rule 9 of Central Excise Rules provide that a manufacturer has to obtain registration of every premises where he carries out manufacture, warehousing of excisable goods. The appellant having utilized services in the un-registered premises, the Credit is ineligible. This is because the service being intangible it cannot be verified whether the serv ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... part of the Credit (Rs 1,19,41,572/-) had done so under protest. The Adjudicating Authority has therefore confirmed demand and ordered for vacation of the protest. It is submitted that the demand confirmed on this ground to the tune of Rs 2,57,83,373/- requires no interference. 14. The above infractions would not have to come to light but for the Audit conducted by the officers of the department. The appellant has suppressed facts with intend evade to payment of duty. The Show cause Notice issued invoking extended period is therefore legal and proper. The Ld. AR prayed that the appeal may be dismissed. 15. Heard both sides. 16. The first issue is the demand confirmed alleging that input service credit has been taken on services availed in unregistered premises. In the Show Cause Notice the allegation is that the Credit has been taken for services availed in the unregistered premises. In the impugned order this unregistered premises is considered to be that of job workers permises. On perusal of the reply to Show Cause Notice it is seen that the appellant has put forward a contention that the unregistered premises is to be considered as job working premises. In para 17.4 the adjudi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ld that by not getting registered, a person does not cease to be a service provider. On a simple reading of the definition of input service and Rule 3 of CCR, 2004 there is no precondition that credit can be availed only after taking registration. If there is violation of not taking registration, the issue has to be adjudicated as per provisions for taking registration. Denying the credit is not the proper course in such situations. 18. If the input services are used in or in relation to the manufacture of the final products the credit is eligible. In the present case, apart from the allegation that the Credit has been availed in their unregistered premises there is no whisper in the Show Cause Notice that appellant has not used such unregistered premises for carrying out activities relating to their manufacturer of final products. In other words the Show Cause Notice itself states that the appellant has a registered premise at SP-114 Ambattur Industrial Estate and also many unregistered premises adjacently in the very same Industrial Estate. This means the activity carried out in unregistered premises is also administrated and controlled or in some way connected to the manufacturi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... l products the Credit would be admissible. The relevant paras of the judgment in the case of M/s. Deepak Fertilizers and Petrochemicals Corporation Ltd. reads as under:- 5 . Now at the outset it must be noted that Rule 3(1) allows a manufacturer of final products to take credit inter alia of Service Tax which is paid on (i) any input or capital goods received in the factory of manufacturer of the final product; and (ii) any input service received by the manufacturer of the final product. The subordinate legislation in the present case makes a distinction between inputs or capital goods on the one hand and input services on the other. Clause (i) above provides that the Service Tax should be paid on any input or capital goods received in the factory of manufacture of the final product. Such a restriction, however, is not imposed in regard to input services since the only stipulation in clause (ii) is that the input services should be received by the manufacturer of the final product. Hence, even as a matter of first principle on a plain and literal construction of Rule 3(1) the Tribunal was not justified in holding that the appellant would not be entitled to avail of Cenvat credit in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nsive meaning of the expression input service in Rule 2(l).The input services in the present case were used by the appellant whether directly or indirectly, in or in relation to the manufacture of final products. The appellant, it is undisputed, manufactures dutiable final products and the storage and use of ammonia is an intrinsic part of that process. 21. In the case of Tata Motors Limited Versus CCE Jamshedpur, 2017 (50) S.T.R 28 (Tri. Kolkata) the issue considered was similar. The assessee in the said case had availed services of some 3rd party processors, who process the raw materials sent to M/s. H.V Axles Limited and M/s. H.V. Transmission Limited, on behalf of the appellant and send those processed raw materials to these companies for further use in the manufacture of axles and gear boxes which were used by the assessee in the manufacture of Motor Vehicles. The assessee paid service tax to these 3rd party processors under Business Auxiliary Services. They availed credit of the service tax paid. Show Cause Notice was issued alleging that the Credit availed on these services was not eligible. The Tribunal after analysing the issue held that the Cenvat Credit Rules makes a dis ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n to avail Cenvat credit on inputs. There is no condition to avail Cenvat credit on input services that services availed should be received by the service receiver/manufacturer in the registered premises. In the case on hand, the goods, on which services were provided, instead of coming to the appellants factory were dispatched to another job worker of the appellants, i.e., HVAL/HVTL. As already emphasized definition of input services does not specify that the services should be received in the factory of the manufacturer. The condition to avail Cenvat credit on input service is that it should be used in or in relation to the manufacture of final products. In this case the service was used in the manufacture of motor vehicle chassis directly or indirectly. It is also a fact that the service charge paid by the appellant to the job worker is included in the assessable value of the final products. 22. The Tribunal in the case of Fives Cail KCP Ltd., Versus CCE Chennai 2018 (363) E.L.T. 1082 (Tri. Chennai) while analyzing similar issue considered the definition of Input Services and held that it is not necessary that the Input Services should be availed in the registered premises itsel ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ent charges, audit fees, bank charges, etc. It cannot be then said that these goods manufactured by the job workers are not being done on behalf of the appellant. Rule 3 of Cenvat Credit Rules to which Ld. AR alluded, also clearly indicates, inter alia, that Service Tax credit in respect of services used in the manufacture of products by a job worker can also be availed. It is very common that part of the manufacture is given to the job worker on the basis of design and drawing supplied, as in this case. Job workers are not responsible for the marketing or sales of the goods, that has to be looked after by the appellants only. Hence input services like sales commission etc. are very much eligible input services in terms of Rule 2(l) of CCR during the period under dispute. This being so, we find that there cannot be any denial of input service credits availed by the appellant, for which reason, the impugned order cannot sustain and will have to be set aside, which we hereby do. Appeal is allowed with consequential relief, if any, as per law. 23. The Hon ble Jurisdiction High Court in the case of CCE and ST Versus M/s. Ashok Leyland Ltd., 2019 (1) TMI 430 Madras High Court held that ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nufacturing unit for final products, there is no nexus between the process of electricity generated and manufacture of final products and there is no necessity for the windmills to be situated in the place of manufacture. Further, as already noticed, the definition of input service is wider than the definition of input . Furthermore, if one takes a look at the Rules, more particularly Rule 2(k), as it stood prior to 1-4-2011, which defines input , the following has been specifically inserted. within the factory of production . However, these words are physically missing in Rule 2(l), which defines input service and it would mean any service used by a provider of taxable service for providing an output service or 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. Though the definition of input service has to be widely construed, and in terms of Rule 3, which allows the manufacturer of final products to take the credit of service tax inputs or capital goods received in the factory of manufacture of final products, insofar as any input service is concerned, the only ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 5th September, 2018 in SCA No. 18433/2017) [2018 (17) G.S.T.L. 3 (Guj.)] followed the dictum of the Supreme Court in Jayam Co. v. Assistant Commissioner (supra) and reiterated that the input tax credit could not be denied on the basis of an amendment, which is prospective. The question dealt with by the High Court was whether Section 140A(3)(iv) of the CGST Act, which declined the Cenvat credit in relation to goods purchased prior to one year from the appointed date, could be given retrospective effect. In answering the question in the negative, the Gujarat High Court held as under : 30. To sum up we are of the opinion that the benefit of credit of eligible duties on the purchases made by the first stage dealer as per the then existing CENVAT credit rules was a vested right. By virtue of clause (iv) of Sub-Section (3) of Section 140A such right has been taken away with retrospective effect in relation to goods which were purchased prior to one year from the appointed day. This retrospectivity given to the provision has no rational or reasonable basis for imposition of the condition. The reasons cited in limiting the exercise of rights have no co-relation with the advent of GST reg ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d by the following judgment:- a) In the case of Roquette Riddhi Siddhi Pvt. Ltd. (supra) CESTAT Bangalore has passed the following decision:- 6.3. The second issue arises in Appeal No. E/20044/2017 is that whether the appellant can avail cenvat credit on the invoices issued prior to 01/09/2014 within six months after the issuance of the Notification No. 21/2014 CE (NT) dated 11/07/2014 or not? The said issue has been settled by this Tribunal in the case of Bharat Aluminium Company Limited wherein this Tribunal has observed as under: 5. Having expressed our anguish, we note that the issue is no more res Integra. Reliance can be placed to the following decisions; (i) Indian Potash Ltd. vs Commissioner of Central GST, Meerut [2018 (10) TMI 1367-CESTAT Allahabad] (ii) Hindustan Coca Cola Beverages Pvt. Ltd. vs. Commissioner of Central Tax [2018 (10) TMI 1366- CESTAT Bangalore] (iii) Industrial Filters Fabrics Pvt. Ltd. vs. CGST CE, Indore[2019 (1) TMI 1426-CESTAT New Delhi] (iv) Suryadev Alloys and Power Pvt Ltd. vs. Commissioner of GST Central Excise, Chennai [2018 (11) TMI 1019-CESTAT Chennai] (v) Umesh Engineering Works vs. Commissioner of Central Tax, Bengaluru West [2019 (1) TMI 1 ..... X X X X Extracts X X X X X X X X Extracts X X X X
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