TMI Blog2023 (2) TMI 895X X X X Extracts X X X X X X X X Extracts X X X X ..... he intention was to permanently attach it to the earth but because foundation was necessary to provide a wobble free operation to the machine. It would also be relevant to refer to the decision of the Supreme Court in SIRPUR PAPER MILLS LTD. VERSUS COLLECTOR OF CENTRAL EXCISE, HYDERABAD [ 1997 (12) TMI 109 - SUPREME COURT ] wherein the Supreme Court observed that merely because a machine is attached to earth for more efficient working and operations it would not per se become immovable property. This issue was also examined at length by a Division Bench of the Tribunal in M/S. RELIANCE JIO INFOCOMM LTD. VERSUS ASSISTANT COMMISSIONER, CGST CENTRAL EXCISE, BELAPUR-IV DIVISION [ 2022 (4) TMI 1361 - CESTAT MUMBAI ] and it was held that towers and shelters would not be immovable property. Thus, in view of the factual position and the decisions referred, the towers and shelters would not be immovable property. CENVAT Credit on capital goods - HELD THAT:- The Delhi High Court in Vodafone Mobile Services [ 2018 (11) TMI 713 - DELHI HIGH COURT ] had also examined this issue and held that the Tribunal clearly erred in concluding that the towers and parts thereo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 4 12.4.2016 2014-15 4. The above four said show cause notices were adjudicated upon by the Commissioner of Service Tax, Delhi [the Commissioner] by order dated 28.9.2016. The demand of CENVAT credit availed by the appellant on towers, shelter and parts thereof, was confirmed on the ground that the subject goods were used for fabrication/erection of towers and shelters, which being attached to earth, were immovable in nature and thus, not used for providing output services in terms of the Circular dated 26.02.2008. 5. The issue involved in this appeal is about denial of CENVAT credit availed and utilized on inputs and capital goods used for setting up of passive infrastructure for provision of Business Support Services [BSS]. 6. Shri B.L. Narasimhan, learned counsel for the appellant assisted by Ms. Purvi Asati submitted that the items in question are movable goods received in CKD condition by the appellant and its eligibility to avail CENVAT credit thereon is determined at the time of receipt of these items. It is for the reason of movability of these items only that excise duty was paid by the suppliers ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... clude land, benefits to arise out of land, and things attached to the earth, or permanently fastened to anything attached to the earth. The term attached to the earth has not been defined in the General Clauses Act, 1897 but section 3 of the Transfer of Property Act defines the expression attached to the earth to mean: (a) rooted in the earth, as in the case of trees and shrubs; (b) imbedded in the earth, as in the case of walls and buildings; (c) attached to what is so imbedded for the permanent beneficial enjoyment of that to which it is attached. 13. The permanency test was examined at length by the Supreme Court in Commissioner of Central Excise, Ahmedabad vs. Solid Correct Engineering Works [2010 (252) E.L.T. 481 (S.C.)] . In this case the Supreme Court drew a distinction between machines which by their very nature are intended to be fixed permanently to the structures embedded in the earth and those machines which are fixed by nuts and bolts to a foundation not because the intention was to permanently attach it to the earth but because foundation was necessary to provide a wobble free operation to the machine. The relevant portion of the judgment is rep ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... if an article is an immovable property, it cannot be termed as excisable goods for purposes of the Act. From a combined reading of the definition of immovable property in Section 3 of the Transfer of Property Act, Section 3(25) of the General Clauses Act, it is evident that in an immovable property there is neither mobility nor marketability as understood in the excise law. Whether an article is permanently fastened to anything attached to the earth requires determination of both the intention as well as the factum of fastening to anything attached to the earth. And this has to be ascertained from the facts and circumstances of each case. (emphasis supplied) 15. It would also be relevant to refer to the decision of the Supreme Court in Sirpur Paper Mills Ltd. vs. Collector of Central Excise, Hyderabad [1998 (97) E.L.T. 3 (S.C.)] wherein the Supreme Court observed that merely because a machine is attached to earth for more efficient working and operations it would not per se become immovable property. The observations are as follows: 5. Apart from this finding of fact made by the Tribunal, the point advanced on behalf of the appellant, that whatever is emb ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e Appellants are immovable property. (emphasis supplied) 17. The Delhi High Court in Vodafone Mobile Services had examined whether the towers, shelters and accessories used by the appellant were immovable property and in this connection, after referring to the decision of the Bombay High Court in Bharti Airtel Ltd. , on which reliance was placed by the Department, observed as follows: 36. In view of this Court, in the facts of the present case, the permanency test has to be applied, in the context of various objective factors and cannot be confined or pigeonholed to one single test. In the present case, the entire tower and shelter is fabricated in the factories of the respective manufacturers and these are supplied in CKD condition. They are merely fastened to the civil foundation to make it wobble free and ensure stability. They can be unbolted and reassembled without any damage in a new location. The detailed affidavit filed by the assessees demonstrate that installation or assembly of towers and shelters is based on a rudimentary screwdriver technology. They can be bolted and unbolted, assembled and re-assembled, located and re-located without any damage a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ng decisions: (i) M/s. Vodafone Mobile Services Limited vs. Commissioner of Central Excise, Jodhpur-(Raj.) [2022 (10) TMI 581 - Cestat New Delhi] ; (ii) M/s. Bharti Airtel Limited. vs. CCE ST- Gurgaon-II [2019 (11) TMI 1162-Cestat Chandigarh] ; (iii) M/s. Bharti Infratel Ltd. vs. Commissioner of Service Tax, Delhi-IV[2019-TIOL-3338-CESTAT-CHD]; (iv) Commissioner of Central Excise and Service Tax-Gurgaon vs. Bharti Infratel Ltd. [2019 (2) TMI 1736 Cestat Chandigarh] ; (v) Bharti Airtel Ltd. vs. Commissioner of Central Excise and Service Tax, Gurgaon-II [2019-TIOL-3355-CESTAT-CHD] ; (vi) M/s. Indus Towers Ltd. vs. Commissioner of Central Excise Service Tax, Delhi-IV [2020-TIOL-886-CESTAT-CHD] ; (vii) Bharti Hexacom Limited vs. Commissioner of Central Excise and Customs, Central Goods and Service Tax, Jaipur-I [2021 (52) GSTL 62 (Tri.- Del.)] ; (viii) M/s. Bharti Airtel Limited vs. Commissioner of Central Excise, Customs Service Tax, Cochin [2021-VIL-443-CESTAT-BLR-ST] ; and (ix) Essar Telecom Infrastructure Pvt. Ltd., Reliance Communication Infrastructure Ltd. vs. Commissioner of Service Tax, Mumbai-I [2015 (6) TMI 544 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the AP High Court in case of M/s. Indus Towers Ltd. v. CTO, Hyderabad - (2012) 52 VSR 447, which clearly ruled that the towers and shelters are indeed used and are integrally connected to the rendition of the telecommunication services. (emphasis supplied) 22. Another alternative submission advanced by the learned Counsel for the appellant that the items in dispute are capital goods and, therefore, credit was correctly taken as capital goods also deserves to be accepted. 23. The Delhi High Court in Vodafone Mobile Services had also examined this issue and the observations are as follows: 44. From the above definition, clearly for goods to be termed capital goods , in the present set of facts, should fulfil the following conditions : 1. They must fall, inter alia, under Chapter 85 of the first schedule to the CET or must be component, parts or spares of such goods falling under Chapter 85 of the first schedule to the Central Excise Tariff Act (CET); and 2. Must be used for providing output service. 45. Accordingly, all components, spares and accessories of such capital goods falling under Chapter 85, would also be treated as capital goods. Now, giv ..... X X X X Extracts X X X X X X X X Extracts X X X X
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