9911796707
TMI Blog2017 (3) TMI 870X X X X Extracts X X X X X X X X Extracts X X X X ..... Karnataka and Roorkee in Uttrakhand etc. is that the appellant for the purpose of Pharmaceutical formulation and manufacture of drugs, maintains two 'Research & Development centres' (R & D centrers) owned and managed by the appellant which are located outside the factory premises and the or Scientific and Technical 'Consultancy Service' is received by the manufacturing units of the appellant from the two R & D centres. The question for determination is, the admissibility of Cenvat credit on input services utilised at the R&D centres of the appellant company and transferred to factory through input service distribution mechanism. 2. The brief facts as per the show cause notice are that in the course of audit it was revealed that during the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ngaged in the manufacture of exempted goods or providing of exempted services, shall not be distributed as provided in Rule 7 of CCR, 2004. It further appeared that the ISD office/head office of the appellant have wrongly taken Cenvat credit of in respect of input services actually received and utilised at the said two R & D centres during the period 2006-07 to 2010-11 and distributed an amount of to their group units in contravention of Rule 3 read with Rule 2(m), 7 (b) and Rule 9 of CCR, 2004 and the same is liable to be disallowed and recovered from them under Rule 14 of CCR, 2004 read with Section 11 A of the Central Excise Act. It further appeared to Revenue from perusal of S.T. Return 3, filed by the appellant, it was noticed that the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... removal. It is further urged that it is admitted fact that the service provided by the R&D centres of the appellant to their manufacturing units is classifiable under the category 'Scientific and Technical Consultancy Service' under Section 65(92) readwith Section 65(105)(za) of the Finance Act. The service is not taxable as there is in-house consumption by the manufacturing units, there being no transfer of ownership. It is further admitted fact that the Scientific and Technical Consultancy is received by the manufacturing units of the appellant, which have manufactured and cleared excisable goods. Accordingly, taking of Cenvat credit is correct in terms of Rule 3 read with Rule 2(l) of CCR, 2004, as the input service received in the R ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rds of width and amplitude. Inclusive definition of Cenvat Credit Rules is not restricted to input services used only for procurement and inward transportation of inputs. Rule 2(l) must be read in its entirety and no interpretation can be given which is contrary to the plain and literal meaning. It was more so as this broad and comprehensive meaning of it to be readwith Rule 3(1) wherein only stipulation is that manufacturer of final products utilized in relation to installation of Ammonia storage tank situated outside the factory of production, for manufacture of dutiable final products, and the storage and use of Ammonia is an intrinsic part of manufacture. Such inputs services were used by the assessee whether directly or indirectly in o ..... X X X X Extracts X X X X X X X X Extracts X X X X
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