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TMI Blog2019 (4) TMI 1969X X X X Extracts X X X X X X X X Extracts X X X X ..... question are products of manufacture and, while 'compressed natural gas' is liable to duty, 'piped natural gas' is not. It is submitted that the 'natural gas' is compressed and dispensed, as well as filled up, at different locations which, while not within the factory of manufacture, nevertheless, constitute place of removal of the product. It is contended by him that the demand for the subsequent period was set aside by order dated 8th July 2016 of the first appellate authority thus 'As per Rule 2(1) of the CCR,2004 'Input Service' means: (l) "input service" means any service (i) used by a provider of taxable service for providing an output service; or (ii) used by the manufacturer, whether directly or indirectly, in or in relation to the manufacture of final products and clearance of final products up to to the place of removal, and includes services used in relation to setting up, modernisation, renovation or repairs of a factory, premises of provider of output service or an office relating to such factory or premises, advertisement or sales promotion, market research, storage up to the place of removal, procurement of inputs, activities relating to bus ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... xcise Rules, 2002 and, therefore, cannot be considered as part of the factory. He drew attention to the finding in the impugned order that 'A careful reading of the said definition reveals that any service can qualify as input service in the case of manufacturer, provided it meets the condition laid down i.e. used whether directly or indirectly, in or in relation to the manufacture of final products and "clearance of final products from the place of the place of removal" (upto 31/3/2008) and "clearance of final products upto the place of the place of removal" (with effect from 1/4/2008). The legislative intention clearly appears that the CENVAT credit of duty paid on the services or inputs shall be admissible provided those service and inputs are used in or in relation to manufacture of final products and clearance thereof from and up to the place of removal. The term 'place of removal' is defined under section 4 of the Central Excise Act 1944 "place of removal" means - (i) A factory or any other place or premises of production or manufacture of the excisable goods; (ii) A warehouse or any other place or premises wherein the excisable goods hav ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e said input services resulted in the creation of an immovable property. Insofar as credit on the services rendered by the other service providers, i.e. other than the pipeline laying contractors as also in respect of capital goods is concerned the only ground on which the notice sought to deny credit was that the same were required by the pipeline laying contractors for rendering their services and could not be said to be input services and capital goods for the appellant.' before rendering the finding that 10. Insofar as the denial of the credit of tax paid by the pipeline laying contractors is concerned, the ground assigned by the respondent for denying credit is clearly fallacious and contrary to the definition of input services, which is reproduced herein below for ease of reference. (l) "input service" means any service, - (i) used by a provider of taxable service for providing an output service; or (ii) used by the manufacturer, whether directly or indirectly, in or in relation to the manufacture of final products and clearance of final products upto the place of removal, and includes services used in relation to setting up, modernization, renovat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... which the Revenue seeks to introduce in the definition of input service is clearly baseless and contrary to the plain language used in the definition of input service. To us it appears completely inconceivable that when the Central Government framed the definition of input service to cover therein services used for setting up a factory/premises of an output service provider, it intended to cover only such input services that were consumed in relation to setting up a factory/office that was mobile or could be moved from one place to other and not a factory or office that was attached to earth and immovable. To our understanding it is only in exceptional situations that one can have factory/premises which are not immovable, most factories and premises will be immovable. In our view any service used in relation to setting up a premises of output service provider is eligible for credit and the concept of movability or immovability, is irrelevant for determining eligibility to input service credit. 13. The aforesaid view of ours also finds support in the judgment of the Hon'ble Punjab and Haryana High Court in the case of Bellsonica Auto Components India Pvt. Ltd. - 2015 (40) S ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e case of Tower Vision India Pvt. Ltd. v. CCE - 2016 TIOL 539 CESTAT-DEL-LB. The said judgment also was dealing with the dispute with respect to eligibility of Cenvat credit of then duty paid on MS angles, channels/parts of tower, etc., which were used for fabrication of telecom towers, as inputs or capital goods. This judgment also does not deal with eligibility of Cenvat credit on input services and consequently cannot be relied upon to deny input service credit in the hands of the appellant. xx 19. The mere fact that some of these services could as well have been contracted for, by the pipeline laying contractors if the agreement between the appellant and the pipeline laying contractor so envisaged, such a hypothetical possibility cannot lead to denial of credit in the hands of the appellant, who has contracted for and availed of the services. In any service contract, it is the scope of the agreement between the service provider and the service recipient that is relevant and needs to be examined for determining the scope of service. To give a simple illustration, a maintenance contract may provide that in case of a break down the part to be replaced be provided by the serv ..... X X X X Extracts X X X X X X X X Extracts X X X X
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