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2019 (3) TMI 1510 - AT - Service TaxCENVAT Credit - input services - services availed for sale of shares - period March 2010 and April 2010 to September 2010 - Held that:- 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 second allegation is that the input services used for raising capital has no nexus with the output service and therefore is not eligible for credit - Though the appellant is engaged in manufacturing 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 categorically held that the activity of raising capital by the disinvestment is directly connected with output service and has correlation with the business activity of the appellant. The allegation raised by the department for disallowing the credit to be unsustainable in law - Appeal allowed - decided in favor of appellant.
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