TMI Blog2018 (6) TMI 1077X X X X Extracts X X X X X X X X Extracts X X X X ..... goods from manufacturer/ dealer. Thus, it was M/s Driplex Water only who could avail the cenvat credit of the duty paid on inputs/ capital goods used by them in providing the works contract service to the appellant in view of the definition of works contract service under clause (zzzza) of Section 65(105) of the Finance Act, 1994. The inputs/ capital goods used by M/s Driplex Water in the present case cannot be distinguished to be out of the scope of being the work contract service. When the Cenvat credit is not available to the contractor, the said cenvat credit cannot be passed on to the appellant namely M/s Bharat Oman Refineries Ltd. Time limitation - Held that:- The fact of availing the benefit of composition scheme by the con ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r supply of fired heat for M.H. block (contractor). The contractor discharged service tax under the category of Works Contract Service as defined under Section 65 (105) (zzzza) of the Finance Act, 1994. The contractor paid the service tax under the Works Contract Composition Scheme and the appellant availed cenvat credit of the service tax so paid. In terms of the Works Contract Composition Scheme, the contractor was not allowed to avail cenvat credit on inputs used by him in providing the service. The Department during the course of verification of the accounts of the appellant, noticed that the appellant had availed cenvat credit on certain inputs as well as various capital goods. In respect of these inputs and capital goods, the buyer ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... h Court of Punjab Haryana reported as 2010 (255) ELT 196 (P H). Ld. Advocate emphasised that the ownership of the capital goods is immaterial in availing the cenvat credit on capital goods. In this connection, he relied on the decision of the Tribunal in the case of Commissioner of Central Excise, Raigad vs. JSW Ispat Steel Ltd. -2015 (327) ELT 549 (Tri. Mum.). ii) He also submitted that credit on capital goods for the appellant cannot be denied by considering the same as inputs for the contractors. In this connection, he referred to the definition of input in Rule 2(a) of the Cenvat Credit Rules, 2004 which specifically excludes capital goods from the purview of inputs. iii) He however submitted that in respect of inputs, for which ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ion or otherwise. Accordingly, he submitted that the value of not only inputs but also capital goods are required to be included for payment of service tax under WCS Composition scheme and no cenvat credit on such goods can be allowed to the contractor. Consequently, he justified the impugned order by stating that the credit which cannot be directly allowed cannot be indirectly disallowed. 6. After hearing both the parties at length our considered observations and findings are as follows: It is the case of the appellant that for setting up crude oil refinery project and plant and machinery, the appellant awarded several contracts for supply, installation and commissioning thereof on lumpsum turnkey basis. On such contract was award ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... vailed cenvat credit have been used by M/s Driplex Water for providing the works contract service. It was M/s Driplex Water who has issued purchase order and procured the goods from manufacturer/ dealer. Thus, it was M/s Driplex Water only who could avail the cenvat credit of the duty paid on inputs/ capital goods used by them in providing the works contract service to the appellant in view of the definition of works contract service under clause (zzzza) of Section 65(105) of the Finance Act, 1994. The inputs/ capital goods used by M/s Driplex Water in the present case cannot be distinguished to be out of the scope of being the work contract service. Thus, the cenvat credit of duty paid on inputs used in providing of the said work contract ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... h are to be transferred to the buyer of the goods only. Here buyer of the goods is the contractor and not the appellant M/s Bharat Oman Refineries Ltd. The fact that invoice mentions the appellants as consignee and the goods were delivered directly at appellants premises is also not relevant for the purpose for the reasons as discussed above. Now coming to the plea of show cause notice being barred by limitation, we are of the considered view that appellants themselves entered into the contract. They were very much aware of terms and conditions thereof and even the legal implications thereof. Ignorance of law about work contracts and respective consequences also the respective liabilities cannot be a ground to extend any benefit to the appe ..... X X X X Extracts X X X X X X X X Extracts X X X X
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