2019 (7) TMI 213 - AT - Service Tax

Utilization of CENVAT Credit - post amendment period - utilization of credit on the services supplied to them during construction of mall for discharging their service tax liability after the constructed mall was rented out on the maintenance repair services - HELD THAT - The issue is no longer res integra in view of the decision of Hon ble Andhra Pradesh High Court in the case of Sai Sahmita Storages (P) Ltd. 2011 (2) TMI 400 - ANDHRA PRADESH HIGH COURT which was subsequently followed by the various other decisions - In all these cases the issue was identical and it was held by various Tribunals/High Court that in such a situation the appellant would be entitled for the benefit of Cenvat credit prior to amendment for post amendment period also. The availment of the Cenvat Credit for being utilised for the payment of service tax on provision of output services of Renting of Immovable Property is allowed - appeal allowed - decided in favor of appellant.

Summary

Issues: Availment of Cenvat Credit for services during construction of immovable property and utilization for service tax liability on renting and maintenance services.

Analysis:

The appeal was filed against an Order-in-Original objecting to the appellant's availment of Cenvat Credit for input services during the construction of commercial properties, which were later rented out. The appellant utilized the credit for service tax on renting and maintenance services. The issue revolved around whether the appellant could utilize the Cenvat credit for services supplied during construction to discharge subsequent service tax liabilities. The Tribunal considered the settled issue in various cases and cited the decision of the Hon'ble Andhra Pradesh High Court in a specific case, followed by other decisions. The Tribunal referred to a previous case where it was held that the appellant was entitled to Cenvat credit for input services used for output services like renting of immovable property.

The Tribunal analyzed the definition of input services under the Cenvat Credit Rules, emphasizing that services used in setting up, modernization, or renovation of premises for output services were eligible for credit. It was noted that the appellant's case fell within this definition, allowing for the availment of Cenvat Credit for payment of service tax on renting of immovable property. The Tribunal referred to a previous order and concurred with the findings, setting aside the Order-in-Original and allowing the appeal with consequential benefits for the appellant.

In conclusion, the Tribunal upheld the appellant's right to utilize Cenvat Credit for services received during the construction of immovable property for the payment of service tax on renting and maintenance services. The decision was based on the interpretation of relevant legal provisions and previous judgments, ultimately granting relief to the appellant by setting aside the original order and allowing the appeal.