Home Case Index All Cases Central Excise Central Excise + AT Central Excise - 2019 (12) TMI AT This
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2019 (12) TMI 331 - AT - Central ExciseCENVAT Credit - duties/tax paid on inputs/input services deployed/utilised for construction of the commercial property which was then leased out - renting of immovable property services provided - period from June 2007 to Mach 2010 - It is the contention of appellant that the inclusion of ‘cement’, ‘angles’, ‘channels’, etc, used in construction of building, among the exclusions in Explanation – II to rule 2(k) of CENVAT Credit Rules, 2004 came into effect only from 7th July 2009. HELD THAT:- As reliance was placed by the original authority on circular no. 98/1/2008-ST dated 4th January 2008 of Central Board of Excise and Customs, it may be necessary to examine the applicability of the intent of that clarification to the present dispute - The issue that was raised therein was whether ‘commercial or industrial construction service’ could be treated as ‘input service’ for the output service of ‘renting of immovable property’ and, while clarifying that ‘commercial or industrial construction service’ is an input service for the output, viz., immovable property, the view taken was that ‘right to use’ of the immovable property, being the output liable to service tax and not the property per se, credit would not be available. It was clearly held in the decision of the Tribunal in Musaddilal Projects Ltd v. Commissioner of Central Excise, Customs & Service Tax [2017 (4) TMI 951 - CESTAT HYDERABAD] that, without the establishing of the property, ‘right to use’ would not come into being. It is inconceivable that a structure which is to be utilized for service can be alienated from the ‘right to use’ - In re Dymos India Automotive Pvt Ltd, [2018 (9) TMI 1135 - MADRAS HIGH COURT] the Hon’ble High Court of Madras has also taken the view that requirement of construction of a building is a necessary pre-condition for rendering the service. Appeal allowed - decided in favor of appellant.
|