TMI Blog2012 (6) TMI 494X X X X Extracts X X X X X X X X Extracts X X X X ..... he definition of input service is exhaustive and is restricted to the services named therein – against assessee. - E/2736 & 2737 of 2010 - Final Order Nos. 6-7/2012 - Dated:- 4-1-2012 - P.G. Chacko, J. B.N. Gururaj for the Appellant. Ms. Sabrina Cano for the Respondent. ORDER 1. In these appeals filed by the assessee, the short question arising for consideration is whether stockbroker's service used by them for the purpose of disposal of the shares held by them in another company is an 'input service within the ambit of the definition of this term under Rule 2(l) of the CENVAT Credit Rules, 2004. The appellant company had held shares in another company namely M/s. Bharti Airtel Ltd. These shares were disposed of by the appellant by availing the services of stockbrokers during the period from June to November 2008. CENVAT credit of the Service Tax and Education Cess paid by the stockbrokers was taken by the appellant, amounting to ₹ 1,66,052/- for June-August and ₹ 69,845/- for September-November 2008. In show-cause notices dated 12.1.2009 and dated 5.3.2009, the department proposed to recover these amounts with interest thereon from the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ements, capital expenses, and for repaying the debts of the company . 3. Claiming support from the affidavit, the learned counsel endeavours to establish an 'integral connection' between the service in question and the business activities of the company. The learned counsel relies on the Bombay High Court's decision in the case of CCE v. Ultratech Cement Ltd. [2010] 29 STT 244 (Bom.) (Para 35). It is submitted that the stockbroker's service was used by the appellant for a purpose which is covered by the inclusive part of the definition of 'input service'. According to the learned counsel, the activity can very well be added to the list of activities which follow the expression such as figuring in the inclusive part of the said definition. It is submitted that the said list of activities is not exhaustive as held by the Hon'ble High Court in the aforesaid case and that the activity of sale of shares can very well be added to the list. In this connection, the learned counsel has also referred to the Memorandum of Association of the appellant-company. He has particularly referred to clauses 2 and 8 under 'Objects incidental or ancillary to th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cture of goods 6. I have given mindful consideration to the submissions. It is not in dispute that stockbroker's service was used by the appellant for sale of their shares held in another company. The question whether the activity of sale of shares had any nexus with the business of the appellant would depend on how the sale proceeds were applied. The Working Director's affidavit does not bring out a clear picture. It contains only general averments. There is nothing in this affidavit to show that the proceeds of sale of shares were applied to any of the activities mentioned in the Memorandum of Association. The main activity mentioned in the Memorandum of Association is manufacture of television sets and other electronic instruments, equipments, devices, components etc. Ancillary objects mentioned in the Memorandum of Association include acquisition of other undertakings with similar objects, acquisition of shares or stock or debentures in other companies, associations, undertakings, etc. It has been argued by the learned counsel that sale of shares held in other companies is 'complementary' to some of the incidental or ancillary objects mentioned in the M ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rvices used in the business, it would be reasonable to construe that the expression 'such as' in the inclusive part of the definition of input service is only illustrative and not exhaustive. Accordingly, we hold that all services used in relation to the business of manufacturing the final product are covered under the definition of 'input service' and in the present case, the outdoor catering services being integrally connected with the business of the manufacture of cement, credit of service tax paid out on catering services has been rightly allowed by the Tribunal. 7 . On the basis of the High Court's ruling, one has to ascertain whether the appellant has established an integral connection between the sale of shares and any of their business activities. I am of the considered view that the appellant has failed to establish this nexus. Where the show-cause notices issued by the department denied CENVAT credit on stockbroker's service on the ground that this service was not used in or in relation to the manufacture of goods, the burden lay on the noticee to establish that the said service was covered by the inclusive part of the input service, if not b ..... X X X X Extracts X X X X X X X X Extracts X X X X
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