2016 (9) TMI 144 - AAR - Service Tax

CENVAT credit input service Held that - the applicant would be entitled to the expenses meant for input services and would be entitled to the cenvat credit only in respect of the input services. Similar issue held in the case 2015 (7) TMI 825 - Advance Ruling Authority . Eligibility of input services related to Capital goods - Applicability of decision in the case M/s Bharati Airtel Vs Commissioner of Central Excise Act Pune-III Bomaby High Court 2014 (9) TMI 38 - BOMBAY HIGH COURT and other rulings - Held that - input is different from input service. This being a major difference the rulings relating to inputs and capital goods will not be applicable to the present case where we have considered the terminology input service .

Summary

The Authority for Advance Rulings (AAR), in the cited 2016 ruling, reaffirmed its prior decision from 2015 (40) STR 393 AAR that "cenvat credit can be taken for input services." The applicant is entitled to claim cenvat credit solely on expenses related to input services. The department's reliance on precedents concerning "inputs" embedded in the earth (e.g., M/s Bharati Airtel v. Commissioner of Central Excise and Indus Tower Tribunal decision) was rejected, as those cases addressed the term "input," not "input services." The AAR emphasized the "major difference" between "input" and "input service," holding that the former rulings are inapplicable, thereby affirming the applicant's entitlement to cenvat credit on input services.