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TMI Blog2021 (4) TMI 137X X X X Extracts X X X X X X X X Extracts X X X X ..... 2(I) of the CENVAT Credit Rules, 2004? 3. Whether the Hon'ble CESTAT, Chennai has erred in holding that the impugned services would qualify as "Input Services" and consequently eligible for input? 4. Has not the Hon'ble Tribunal committed an error in including within the ambit of Input Services, the services rendered by a third party, contrary to the confined meaning assigned to input services defined in Rule 2(I) of CENVAT Credit Rules, 2004?" 3. The respondent/assessee is engaged in the manufacture of motor cycles, parts and engines covered under Chapter heading 87.11, 87.14 and 87.08 of the Schedule to the Central Excise Tariff Act, 1985 and are availing Cenvat Credit on input services in terms of the Cenvat Credit Rules, 2004. 4. The respondent/assessee entered into an agreement with M/s.TVS Finance and Services Limited (hereinafter referred to as TVSFS for brevity) to provide finance facilities to customers, who purchase two wheelers manufactured by the respondent/assessee. In terms of the agreement, the assessee, apart from providing financial services, have entered into an arrangement with the respective authorized dealers to give sufficient space and facility ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... with service tax payable thereon. They availed Cenvat Credit on the service tax on the services provided by TVSFS. Further, the various marketing activities and business promotion activities were elaborately set out in the reply. 8. It is contended that promotion of sale at the retail level is an important element in increasing the sale of the manufactured products, financing of purchase of two wheelers by customers is directly responsible for the increased sale of vehicles followed by increased production and subsequent clearance of the vehicles. Therefore, financing of two wheelers is a service used by them in or in relation to manufacture of the final product, namely two wheelers, directly or indirectly. Further, it was submitted that it was irrelevant as to where the financing takes place and at what stage of sale as long as the service is in relation to financing of the vehicles manufactured by the assessee and therefore, such service provided by TVSFS is an input service. 9. Further, the assessee contended that the services used in activities relating to business are eligible for Cenvat Credit and the inclusive clause of the definition cover input services pertaining to ac ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ervice tax paid thereon. Further, TVSFS obtained registration and paid service tax. It was stated that they undertook various steps to increase the sale of two wheelers through retail financing and they expanded their operation in various states that resulted in promotion of sales of TVS motor vehicles, which resulted in penetration of sales in semi urban and rural areas. As a consideration, the assessee had paid charges by way of infrastructure and other charges. They also referred to various Memorandum of Understandings, which specifies the obligations of TVSFS to the assessee. 13. Further, the contention was that they had set up requisite infrastructure facilities in the premises of the dealers of the assessee, they pointed Territory Sales Executives and posted Direct Selling Agents in such centres and through such centres, they made their presence in the areas of sale and promoted or marketed the financing service and sale of the two wheelers manufactured by the assessee. Further, they conducted loan melas and campaigns for promoting financing and sale of the two wheelers manufactured by the assessee. 14. The assessee further submitted that with effect from 01.07.2003, "busin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ivity did not have any nexus to the manufacture of two wheelers by the assessee. The adjudicating authority cannot be blamed for having taken such a stand as he had passed his order on 30.10.2009 and obviously did not have the benefit of the decision of the Larger Bench of the Hon'ble Supreme Court in the case of M/s.Ramala Sahakari Chini Mills Ltd., Vs. Commissioner of Central Excise [2016 (334) ELT 3 (SC)], dated 19.02.2016. When the Tribunal passed the impugned order, the aforesaid decision was very much available and though the learned counsel for the assessee relied on the same and this was noted by the Tribunal in paragraph 2.2 of the order, the Tribunal has not applied the said decision while allowing the appeal filed by the assessee. 21. The question referred for consideration to the Larger Bench of the Hon'ble Supreme Court was whether the definition of the term "input" in Rule 2(g) of the Cenvat Credit Rules, 2002 is to be understood to include items beyond the 6 items mentioned specifically in Rule 2(g). The Larger Bench held that the word "include" in the statutory definition is generally used to enlarge the meaning of the preceding words and it is by way of ex ..... X X X X Extracts X X X X X X X X Extracts X X X X
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