Contact us   Feedback   Annual Subscription   New User   Login      
Tax Management India .com
TMI - Tax Management India. Com
Extracts
Home List
← Previous Next →

2016 (9) TMI 1240 - CESTAT KOLKATA

2016 (9) TMI 1240 - CESTAT KOLKATA - TMI - Cenvat credit - service tax paid on input services - used in the manufacture of axles and gear boxes, which are used in the manufacture of final products i.e. motor vehicles & chasis Held that:- by respectfully following the decisions of the Hon’ble Bombay High Court in the case of Commissioner of Central Excise and Customs, Aurangabad vs. Endurance Technology Pvt. Ltd. [2015 (6) TMI 82 - BOMBAY HIGH COURT] which is an uphelded decision of Tribunal repo .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

n the input services. - In the case on hand, the goods, on which services were provided, instead of coming to the appellants factory were dispatched to another job worker of the appellants i.e. HVAL/HVTL. The definition of input services does not specify that the services should be received in the factory of the manufacturer. The condition to avail cenvat credit on input service is that it should be used in or in relation to the manufacture of final products. In this case the service was us .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

DER Per Shri P. K. Choudhary 1. M/s. Tata Motors Limited, Jamshedpur, the appellants herein are engaged in the manufacture of commercial motor vehicles & chassis and parts thereof falling under Chapter 87, 84, etc. of the First Schedule to the Central Excise Tariff Act, 1985 at their factory located at Jamshedpur. The appellants are availing cenvat credit of the duty paid on the inputs as well as input services received and used by them in the manufacture of final products. Appellants do not .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

exure 1&2 at pages 26-33 of the appeal paper book. 2. HVAL and HVTL never sold axles and gear boxes to the appellants, since they have undertaken the process of manufacture out of the raw materials supplied to them by the appellants. Since no sale is taking place on the transfer of axles and gear boxes from HVAL and HVTL to the appellants, no sales tax is charged from the appellants. Illustrative copy of the invoices of HVAL and HVTL are available as Annexure 3&4 at pages 34 and 35 of th .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

hase order placed by the appellants on the 3rd party is available on page 36 of the appeal paper book. The appellants have paid processing charges to the 3rd party processors along with applicable service tax under the Business Auxiliary Services in terms of Section 65(19) read with Section 65 (105)(zzb) of the Finance Act, 1994. Accordingly, the appellants have taken credit of the service tax paid since the said services were used in the manufacture of axles and gear boxes, which are used in th .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

d the grounds of appeal and submitted that the appellants are receivers of the services rendered by the job worker and the said services have been used directly or indirectly, in or in relation to the manufacture of final products i.e. motor vehicles and accordingly the appellants are entitled to credit of service tax paid on the input services. Ld. Counsel also filed a flowchart depicting the movement of raw materials to the various job workers for processing. He also submitted a paper book con .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

ition of input services not only uses the expression in or in relation to the manufacture of final product but has also used the expression whether directly or indirectly, in or in relation to the manufacture of final products. 5. Axles and gear boxes are undisputedly used in the manufacture of motor vehicles and the services rendered by the 3rd party processors which were first used in the manufacture of axels and gear boxes, would still be satisfying the expression services used by the manufac .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

manufacture of motor vehicle chassis is wholly incorrect and unsustainable in law. 6. Shri K.Choudhuri, Suptd.(AR) appearing on behalf of the Revenue reiterated the discussions and findings of the impugned order. 7. Heard both sides and after perusal of the case records we find that vide Notification No.8/2005-S.T. dated 01.03.2005 exemption has been extended to taxable service of production of goods on behalf of the client referred in sub-clause(b) of Clause (19) of Section 65 of the Finance Ac .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

ed in the manufacture of final product. Therefore, the service falls under the definition of input service. As regards input service used at a different place it is pertinent that there is no mandate in law that it should be used in the factory unlike inputs, which is clear from Rules 4(1) and 4(7) of the Cenvat Credit Rules, 2004 reproduced herein :- Rule 4(1). The CENVAT credit in respect of inputs may be taken immediately on receipt of the inputs in the factory of the manufacturer or in the p .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

ob worker. Rule 4(7). The CENVAT credit in respect of input service shall be allowed, on or after the day which payment is made of the value of input service and the service tax paid or payable as is indicated in invoice, bill or, as the case may be, challan referred to in Rule 9. 7.3 The Tribunal in the case of Indian Rayon & Ind. Ltd. (supra) has held that no such stipulation regarding receipt of input service, which is separately defined under the Rules, is provided. The Hon ble High Cour .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

TIOL-1227- CESTAT-MUM = 2011 (21) S.T.R. 297 (Tri. - Mum.), this Tribunal has held that the denial of CENVAT credit on the ground that services were not received by the respondent in factory premises is not sustainable. 7.1. In the aforesaid decision it was held that services rendered outside the factory when have a nexus with the manufacture of final product then such services are covered under definition of input service of the Cenvat Credit Rules, 2004. This decision of the tribunal has been .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

that Cenvat credit is eligible on maintenance or repair services of Windmills, located away from the factory. It is well settled that the decision of Hon ble High Court is binding on the Tribunal. It was pointed out at the time of hearing that the definition of input service credit was subsequently amended in 2011. We find that the present appeals are involving for the period 2006-2007. In any event, this issue is not before the Larger Bench. Hence, the view taken by the Tribunal in the case of .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

 

 

 

 

 



|| Home || Acts and Rules || Notifications || Circulars || Schedules || Tariff || Forms || Case Laws || Manuals ||

|| About us || Contact us || Disclaimer || Terms of Use || Privacy Policy || TMI Database || Members || Site Map ||

© Taxmanagementindia.com [A unit of MS Knowledge Processing Pvt. Ltd.] All rights reserved.

Go to Mobile Version