TMI Blog2023 (7) TMI 631X X X X Extracts X X X X X X X X Extracts X X X X ..... and modernization of their premises. The specific disallowance of availment of Cenvat credit with respect to such construction/erection, installation and commission, services which are with respect to the new construction if undertaken by the assessee, however, there is no such specific disallowance in Rule 2 (i) of CCR, 2004 with respect to repair and maintenance work of the premises of the manufacturer. Time limitation - only allegation is that had the Department not conducted audit, the appellant would have succeeded to evade - HELD THAT:- The said allegation has no basis to stand otherwise also, it is observed that the show cause notice was based on appellant s own documents i.e. the invoices as were maintained by them in accordance of business the returns were admittedly being filed in time mentioning required details about availment of credit. There is nothing on record which may be called as the proof for alleged suppression or mis-conduct. Resultantly the extended period of limitation has wrongly been invoked by the Department while issuing the impugned show cause notice. The order under challenge is also liable to be set aside for an apparent ambiguity in the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... or the appellant and Shri Mahesh Bhardwaj, learned authorized representative for the Department. 3. Learned Chartered Accountant for the appellant has submitted that the services availed by the appellants were in relation to the renovation, repairs, modernization of the factory of the appellants where he was manufacturing his final products. It is submitted that the construction services in relation to repair, maintenance and modernization are well covered in the inclusive part of the definition of input service in CCR, 2004. The Adjudicating Authorities have wrongly considered the same as works contract services which fall under the exclusion clause of the definition of input. The findings of the Adjudicating Authority below, on both counts factual as well as legal, are apparently false. It is submitted that appellant had provided all the relevant documents including all the invoices as many 293 in number. The Original Adjudicating Authority had dropped the demand with respect to 58 number of invoices where the nature of service was specifically mentioned as maintenance, management or repair service. However, the remaining invoices where the nature of work was mentioned as erec ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ment of Cenvat credit by the appellant on those services. With these submissions the appeal prayed to be dismissed. 6. Having heard the rival contentions, the moot question of adjudication appears to be as follows :- Whether the services received by the appellants can be classified as works contract service on which the appellant was not supposed to avail the Cenvat credit. For the purpose the definition of works contract service need to be looked into. Section 65B in 54 defines works contract as follows :- ( 54 ) Works contract means a contract wherein transfer of property in goods involved in the execution of such contract is leviable to tax as sale of goods and such contract is for the purpose of carrying out construction, erection, commissioning, installation, completion, fitting out, repair, maintenance, renovation, alteration of any movable or immovable property or for carrying out any other similar activity or a part thereof in relation to such property; 7. No doubt the services as that of maintenance, repair, alteration etc. also gets the covered under definition, but simultaneously definition of input service in Section 2 (l) of Finance Act is perused w.e ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tion of any employee; Clause (b) of Section 66E (also introduced w.e.f. 1.7.2012) of the Finance Act, 1994 . 8. From the perusal of both the definitions, I observe that modernization, renovation or repairs of a factory are appearing in the inclusion part of the definition of input service. In the exclusion part such work contracts are covered where service element can be vivisected from the goods element and the properly in those goods gets transferred in favour of the recipient. I don t find any evidence on record produced by the Department to prove that the construction services for the building/civil structure was for a building other than the factory premises of the appellant. Also there is no evidence to prove that properly in goods got transferred to appellant. In the absence thereof and from the perusal of the chart on record it is observed that most of the invoices irrespective those were of erection, commissioning and installation work but were for the manufacturing place of the appellant/the out locations of the appellant premises like office like gates, bridge lop, canteen, transformer, barricading, repair of drain cover, partition/furniture fixing, repair of bou ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... l within the meaning of input service even though; construction of a building or civil structure or part thereof has been placed under exclusion clause of the said definition of input service . After amendment to the definition of the input service , a clarification issued by the Board vide Circular No. 943/4/2011-CX, dated 29-4-2011 whereunder answering to the questions raised on the eligibility of credit of service tax paid on construction service as an input service used in modernization, renovation or repair, it has been clarified that the said services being provided in the inclusive part of definition of input service are definitely eligible to credit. Thus, harmonious reading of the inclusive part of the definition and the exclusion clause mentioned at clause (a) relating to construction service of the definition of input service , it is clear that the construction service relating to modernization, renovation and repair of the factory continued to be within the meaning of input service and accordingly, the Service Tax paid on such service is eligible to credit. Undisputedly, the appellant carried out modernization/renovation work to meet USA, FDA guidelines for m ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... reported as 2013 (288) E.L.T. 161 (S.C.) 14. In an earlier decision in the case of Continental Foundation Jt. Venture versus Commissioner of Central Excise, Chandigarh reported as 2007 (216) E.L.T. 177 (S.C.) the Hon ble Supreme Court in para 12 has held as under : 12. As far as fraud and collusion are concerned, it is evident that the intent to evade duty is built into these very words. So far as mis-statement or suppression of facts are concerned, they are clearly qualified by the word wilful , preceding the words mis-statement or suppression of facts which means with intent to evade duty. The next set of words contravention of any of the provisions of this Act or Rules are again qualified by the immediately following words with intent to evade payment of duty. Therefore, there cannot be suppression or mis-statement of fact, which is not wilful and yet constitute a permissible ground for the purpose of the proviso to Section 11A. Mis-statement of fact must be willful . 15. In the present case also, I observe that the show cause notice has not specified any commission or omission which may reveal intention to evade the payment of duty. The only allegation is that ..... X X X X Extracts X X X X X X X X Extracts X X X X
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