Cce, Delhi-Iv vs M/S. Prasha Technologies Ltd

[Arising out of Order-in-Appeal No. 265-266/SVS/GGN/2013 dated 01.05.2013 passed by the Commissioner of Central Excise (Appeals), Delhi-III, Gurgaon]

For approval and signature:

HONBLE MR. S.K. MOHANTY, MEMBER (JUDICIAL)

1 Whether Press Reporters may be allowed to see the Order for publication as per Rule 27 of the CESTAT (Procedure) Rules, 1982?

2 Whether it should be released under Rule 27 of the CESTAT (Procedure) Rules, 1982 for publication in any authoritative report or not?

3 Whether Their Lordships wish to see the fair copy of the Order?

4 Whether Order is to be circulated to the Departmental authorities?

CCE, Delhi-IV Appellant

Vs.

M/s. Prasha Technologies Ltd.  Respondent

Present for the Appellant : Shri. R.K. Mishra, D.R.

Present for the Respondent: Shri Kalyan Singh, Consultant

Coram: HONBLE MR. S.K. MOHANTY, MEMBER (JUDICIAL)

Date of Hearing/Decision: 05.08.2015

FINAL ORDER NO.54146/2015

PER: S.K. MOHANTY

Revenue has filed this appeal against the impugned order dated 1st May, 2013 passed by the Commissioner of Central Excise (Appeals), Delhi-III, Gurgaon, wherein cenvat credit taken on various input services by the respondent herein has been allowed, holding that the said services are confirming to the definition of input service containing in Rule 2 (l) of the Cenvat Credit Rules, 2004. The Revenue has filed this appeal with regard to cenvat credit taken by the respondent on civil construction service on the ground that the said service has no nexus with the final products manufactured by the respondent. In the grounds of appeal, the Revenue has cited the decisions of various judicial forums to justify that unless the input service has the nexus with the manufacture of final product, the cenvat credit shall not be available.

2. The ld. Consultant appearing for the respondent submits that service tax paid on Civil Construction service has been taken as cenvat credit and said service falls under the definition of input service under Rule 2(l) of the Cenvat credit Rules. He further submits that the services are in relation to the modernization / renovation of the factory, which is categorized as input service in the inclusive part of the definition. With regard to eligibility of cenvat credit on the disputed service, the ld. Consultant relies on the circular No.943/04/2011-CX dated 29th April, 2011, wherein it has been clarified that the credit of input services used for repair or renovation of factory or office can be allowed for cenvat benefit. Further, the ld. Consultant also relies on the decision of this Tribunal in the case of NTF (India) Pvt. Ltd. vs. CCE, Delhi-III reported in 2013 (30) STR 575 (Tri.-Del.) to justify his stand that cenvat credit cannot be denied on the service tax paid on the disputed service.

3. Shri R.K. Mishra, the ld. D.R. appearing for the appellant submits that since there is no nexus between the disputed service and the final product manufactured by the respondent, cenvat credit is not permissible on the said service.

4. Heard ld. Counsel for both sides and perused the records.

5. On perusal of the definition of input service contained in Rule 2(l) of Cenvat Credit Rules, 2004, it reveals that the input service specifically covers services used in relation to setting up, modernization/ renovation or repair of the factory. Since the service has been categorically specified in the definition clause of input service, service tax paid on such service cannot be denied on the ground that the said service has no nexus with the manufacture of final product.

6. I find that this Tribunal in the case of NTF (India) Pvt. Ltd. (supra) has allowed the cenvat credit by holding that the construction service is specified in the definition clause of input service for the purpose of taking of cenvat credit. In view of above, I do not find any merits in the appeal filed by the Revenue, and thus, the same is dismissed.

(Dictated and pronounced in the open Court)

(S.K. MOHANTY)

MEMBER (JUDICIAL)

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