TMI Blog2023 (12) TMI 1062X X X X Extracts X X X X X X X X Extracts X X X X ..... at the input services like security service, mining service, transportation etc used by the captive mines bears a direct nexus with Appellant s units manufacturing final products i.e. Steel. Hence, such services are very well covered within the scope of the definition of input services . Rule 3 of CCR does not mandate that for the purpose of availment of credit on input services, such services should be received within the premises where manufacture of final product takes places but only provides that services should be used in or in relation to the manufacture of final products. Thus, the Appellant is entitled to avail credit of service tax paid on input services received at the mines, which serves as an intermediate product for manufa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nes like Cargo handling, mining service, security services, etc. within the mines. These service providers raise invoice in favour of captive mines and subsequently such mines avails credit of input services and distributes credit of such service on pro-rata basis as per provisions of Rule 7 of the CENVAT Credit Rules, 2004 ( CCR ), to the manufacturing units. A SCN bearing No. 06/COMMR/BOL/18-19 dated 28.06.2018 was issued upon the Appellant, proposing recovery of irregular credit amounting to Rs. 8,82,11,067/-. In the Notice, it has been alleged that the Appellant has availed Cenvat credit on the strength of ISD invoices issued by the mines, which produce iron ore, limestone flux etc. which are not chargeable to excise duty nor do the min ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... id on services availed at mines is admissible to manufacturing units. Accordingly, the Appellant submits that the credit availed by them on the basis of ISD invoices issued by the captive mines cannot be construed as ineligible credit. 4. The Appellant further submits that the Issue is no longer res integra as this Tribunal on identical facts and circumstances has decided the same issue in favour of the Appellant in the case of Usha Martin Ltd. v. CCE, Jamshedpur, 2023 (6) TMI 1153 - CESTAT Kolkata . Accordingly, the Appellant prayed for allowing their appeal. 5. The Ld. D.R. reiterated the findings in the impugned order. 6. Heard both sides and perused the appeal records. 7. We observe that the issue to be decided in the presen ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... MI 1153 - CESTAT Kolkata. The relevant paras of the said decision are reproduced below: 10. The crux of the issue before us in all these appeals is whether cenvat credit of service tax could be availed by the factory in respect of input services received at the captive coal iron ore mines, either directly or on the strength of the ISD invoices issued by the Bokna Mines Office. Ld. Commissioner 8/14/23, 1:36 PM M/s. Usha Martin Limited Versus Commissioner of Central Excise, Jamshedpur https://www.taxmanagementindia.com/Print/print_case_laws.asp?ID=4 39579 head_note=No 5/7 entertained a view that coal and iron ore mines situated away from the factory were separate entities having their own financial transactions engaged in the manufactu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... striction carved out for receipt of inputs in the factory of manufacture under Rule 3 no such limitation exists for input services. We also find that a similar issue in the context of availment of cenvat credit of service tax in the hands of the factory in respect of input services received at the Captive Mines had fallen for consideration of the Tribunal in the case of Hindalco Industries case (supra). The period involved therein was March 2005 to October 2010 and the credit was availed by the assessee s factory therein, directly as also on the strength of ISD invoices issued by the mines. The Tribunal allowed the credit of service tax to the assessee s factory by treating the Captive Mines and the factory as one integrated unit. Para 9 of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... bility of credit of tax paid on lease rentals, operation and maintenance of Wind Mill situated far away from the assessee s factory. The power generated from the Wind Mill therein was supplied to TNEB grid which in turn transmitted the power to the factory of the assessee. The Hon ble Court after taking note of the wide definition of input service allowed the credit of service tax to the factory of the assessee. In light of the above decisions, we hold that the denial of credit of service tax by the Ld. Commissioner in the instant case is unsustainable. 9. By relying on the decision cited above we hold that the Appellant is eligible to avail CENVAT Credit of input services relating to captive mines, which is distributed to the Appell ..... X X X X Extracts X X X X X X X X Extracts X X X X
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