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2015 (6) TMI 544 - CESTAT MUMBAI

2015 (6) TMI 544 - CESTAT MUMBAI - 2015 (40) S.T.R. 591 (Tri. - Mumbai) - Cenvat Credit - availment of Cenvat Credit on the capital goods and the input services - construction of towers for providing Telecom Infrastructure - Held that:- the issue involved in this case is regarding the services rendered by the appellants as infrastructure service providers and not as telecom service provider and are providing business support service in form of infrastructure service; - Decisions in the cases of .....

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Respondent : Shri D Nagvenkar, Commissioner (AR) ORDER Per: M V Ravindran: These two appeals are disposed of by a common order as the issue raised is the same. 2. These appeals are filed against Order-in-Original No. 33/ST/SB/2011-12 dt. 29.2.2012 and OIO No. 68/ST-II/RS/2013 dt. 31.10.2013. 3. Relevant facts that arise for consideration are the appellants herein are providers of Telecom Infrastructure. They owned and lease out the towers to various telecom companies. They discharge the service .....

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the appellant's interest thereof and also for imposition of penalties. Both the appellants contested the show cause notice on merits, taking a plea that the said towers which are constructed/erected are required for providing of output service namely Business Support Services. Adjudicating authority did not agree with the contentions raised by the appellant. After following the due process of law confirmed demand raised along with interest and imposed penalties. 4. Ld. Counsel appearing on .....

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is duplication of demand inasmuch that appellant had availed Cenvat Credit of the capital goods in the first year which was 50% of the duty paid on capital goods and the next 50% in the subsequent financial year which was considered by the department as wrong availment of Cenvat Credit. It is his submission that the first credit taken of the first 50% is itself contested by the department on the ground that the towers which are constructed/erected are immoveable goods and cenvat credit cannot be .....

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harti Airtel Ltd. Vs. Commissioner of Central Excise, Pune-III 2014 (35) STR 865 (Bom.) was considering the issue of eligibility to avail Cenvat Credit on the towers as capital goods as well as inputs, denied the Cenvat Credit holding that towers are immoveable property. He would submit that the latest judgment of the Tribunal in the case of Tata Teleservices Ltd. Vs. CST Appln. No. ST/MA(Ors)92633/15 & 92634/15is also following the law laid down by the Hon'ble High Court in the case of .....

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case of Mundra Port & Special Economic Zone Ltd. 2009 (13) STR 178 (Tri.Ahmd.) and Gujarat State Petronet Ltd. 2013 (32) STR 510 (Tri.-Ahmd.) clearly lays down a ratio of 'nexus' for the availment of the Cenvat Credit. He would also read the definition of input services after 1.4.2011 is important. He would also submit that as per the provisions of Section 94, is the empowering Section which grant, power for making Cenvat Credit Rules, has to be read that consumption of inputs or ca .....

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would mean that the legislature wanted to give a practical meaning as to the eligibility to avail Cenvat Credit on inputs, capital goods and input services to the output service provider. It is the submission that order of Tribunal in the case of Mundra Port & Special Economic Zone Ltd. (supra) as cited by learned D.R. is set aside by the Hon'ble High Court of Gujarat in an unreported judgement dated 29.04.2015 and undertakes to submit a copy of judgement, which he did. 7. We have consid .....

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ere providing output services to their client and customers who are telecom companies. The telecom companies are charged by the appellant for using the towers based upon the understanding between them. The appellants had contested the findings before us on the ground that the capital goods, inputs and input services have been used by them for construction and erection of telecom towers which is in turn is used by them for providing output service under the category of Business Support Services t .....

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mbay in the case of Bharti Airtel Ltd. The Bench after considering all the submission made by the Ld. AR, which were the same as is being canvassed today before us by the Ld. AR, discarded arguments made by the Ld. AR for the reliance placed on the judgment of the Hon'ble High Court in the case of Bharti Airtel Ltd. by recording the following: "In both the appeals, the appellant has claimed support in the above context from the following decisions:- (i) Indian Copper Corporation Ltd. vs .....

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FB was essential in providing output service and therefore the duty paid thereon would be available as credit to the telecom operator. Alternatively, the appellant has contended that the tower (and parts thereof) and the PFB would also qualify as 'inputs' used for providing output service. This contention is based on sub-clause (ii) of clause (k) of Rule 2 (definition of "input") of the CENVAT Credit Rules. In this connection, the appellant has relied on the following decisions .....

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