TMI Blog2018 (6) TMI 636X X X X Extracts X X X X X X X X Extracts X X X X ..... aman, Advocate for the Appellant Shri K.P. Muralidharan, AC (AR) for the Respondent ORDER The appellant is engaged in business of manufacture of Pharma products and is availing CENVAT credit on inputs and input services under the provisions of CENVAT Credit Rules, 2004. Show cause notice was issued proposing to disallow credit availed on service tax paid on rental charges for their Mumbai office for the period January 2012 to March 2015. After due process of law, the original authority confirmed the demand, interest and imposed penalties. In appeal, Commissioner (Appeals) upheld the same. Hence this appeal. 2. On behalf of the appellant, ld. counsel Shri V. Raghuraman submitted that the office at Mumbai operates as procurement / marketing office for the appellant since all the orders for manufacturing unit are procured by their Mumbai office. The appellants have only one manufacturing unit which is located at Hosur and their office at Mumbai procures the orders which is essential for the purpose of receiving orders from various pharmaceutical companies. All these activities done at the Mumbai office are either directly or indirectly in or in relation to manufacturi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... there is proper disclosure of all facts for their ERI returns and accounts, the department without basis, alleged that there is suppression of facts with intent to evade payment of duty. That the demand itself is time-barred. 3. The ld. AR Shri K.P. Muralidharan supported the findings in the impugned order. He submitted that the said services of renting of immovable property were not received within the manufacturing premises of the appellant and therefore the authorities below have rightly disallowed the credit. 4. Heard both sides. 5. The ld. counsel has explained that the manufacturing activities carried out in their factory located at Hosur, Tamilnadu and they are mainly engaged in undertaking manufacturing of pharmaceutical products on loan license basis or contract manufacturers for other companies. The Mumbai office operates as a procurement office for the Hosur factory. Therefore, procurement of orders / products being the starting point for the manufacturing activities is performed at the Mumbai office without which there can be no manufacturing activity at its factory in Hosur. The Tribunal in the case of Carrier Air Conditioning and Refrigeration Ltd. (supra) ha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... arch, storage upto the place of removal, procurement of inputs, accounting, auditing, financing, recruitment and quality control, coaching and training, computer networking, credit rating, share registry, security, business, exhibition, legal services, inward transportation of inputs or capital goods and outward transportation upto the place of removal; but excludes services, - (A) specified in sub-clauses (p), (zn), (zzl), (zzm), (zzq), (zzzh) and (zzzza) of clause (105) of Section 65 of the Finance Act (hereinafter referred as specified services), insofar as they are used for - (a) Construction of a building or a civil structure or a part thereof; or (b) Laying of foundation or making of structures for support of capital goods, except for the provision of one or more of the specified services; or (B) Specified in sub-clauses (d), (o), (zo) and (zzzzj) of clause (105) of section 65 of the Finance Act, insofar as they relate to a motor vehicle is available as capital goods; or (C) Such as those provided in relation to outdoor catering, beauty treatment, health services, cosmetic and plastic surgery, membership of a club, health and fitness centre, lif ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ve provides that the Service Tax should be paid on any input or capital goods received in the factory of manufacture of the final product. Such a restriction, however, is not imposed in regard to input services since the only stipulation in clause (ii) is that the input services should be received by the manufacturer of the final product. Hence, even as a matter of first principle on a plain and literal construction of Rule 3(1) the Tribunal was not justified in holding that the appellant would not be entitled to avail of Cenvat credit in respect of services utilized in relation to ammonia storage tanks on the ground that they were situated outside the factory of production. The definition of the expression input service‟ covers any services used by the manufacturer, whether directly or indirectly, in or in relation to the manufacture of final products. The words directly or indirectly‟ and in or in relation to‟ are words of width and amplitude. The subordinate legislation has advisedly used a broad and comprehensive expression while defining the expression input service‟. Rule 2(l) initially provides that input service means any services of the descript ..... X X X X Extracts X X X X X X X X Extracts X X X X
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