M/S. Sail (Alloy Steel Plant) vs Commissioner Of Central Excise & S. Tax, ...

Appeal No. ST/70337/2013 (Arising out of the order in Appeal No. 04/Bol/2013 dated 07.01.2013 passed by the Commissioner of Central Excise, Kolkata.

FOR APPROVAL AND SIGNATURES OF

SHRI H.K.THAKUR, HONBLE TECHNICAL MEMBER

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?

M/s. SAIL (Alloy steel Plant) APPLICANT(S) VERSUS Commissioner of Central Excise & S. Tax, Bolpur ...RESPONDENT (S)

APPEARANCE:

SHRI Hoursh Shukla, (C.A) FOR THE APPELLANT SHRI S. Nath, A.C (AR) FOR THE RESPONDENT

CORAM:

SHRI H.K.THAKUR, HONBLE TECHNICAL MEMBER

Date of Hearing: 16.10.2015 Date of Decision: 16.10.2015

ORDER NO. FO/A/75612/15

Per Shri H.K.Thakur

This appeal has been filed by the appellant against OIA No. 04/BOL/2013 dt 07/01/2013 passed by Commissioner (Appeals-III) Kolkata as first appellant authority. Under this OIA dt 07/01/2013 first appellate authority has allowed the appeal filed by the Revenue against OIO No. 07/AC/ASP/DGP-iv/11-12 dt 14/07/2011 where Cenvat credit was allowed to the appellant on the telephone services availed at the residences of the senior officers of the appellant. 2 Sh. Harsh Shukla (CA) appearing on behalf of the appellant argued that first appellate authority has held that telephone services availed at the residences of the senior officers of the company is no way related to the business and manufacturing activities of the appellant. Learned CA argued that period of demand is June 2008 to August 2009 and show cause notice was issued an 07/04/2011. That there are following case laws in their favour the issues on merits is in their favour & extended period can not be invoked.

(i) CCE, Chennai-III v. Greaves Cotton Ltd.-2009(239) ELT 137 (Tri.-Chennai)

(ii) CCE V. Excel Crop Care Ltd.  2008 (12) STR 436 (Guj.)

(iii) Keltech Energies Limited v. CCE, Mangalore -2008 (10) STR 280 (Tri.  Bang.)

(iv) BASP Industries v. CCE, Mumbai-III  2011 (24) STR 30 (Tri.  Mumbai)

(v) Muscat Polymers Pvt. Ltd. v. CCE, Rajkot  2012 (26) STR 122 (Tri. Ahmd)

(vi) Bharat Petroleum Corporation Ltd. V. CCE, Mumbai-II 2013 (31) STR 455 (Tri.  Mumbai)

(viii) CCE, Nagpur v. Ultratech Cement Ltd.  2010 (20) STR 577 (Bom.)

(ix) Indian Rayon & Industries Ltd vs CCE, Bhubaneswar [2006 (4) STR 79 (Tri.  Mumbai).

2.1 Learned CA also made the bench go through Para 8.3 of CBEC Circular No. 97/8/2007-ST dt 23/8/07 according to which Service tax paid on mobile phone Services has been clarified to be admissible. He also produced copies of BSNL bills according to which entire bill amount, alongwith Service tax with respect to residential telephone lines, has been paid by the appellant.

3. Sh. S. Nath AC (AR) appearing on behalf of the Revenue relied upon the case law of Monnet Ispat & Energy Ltd vs CCE Raipur [2010 (19) STR 417 (Tri  Del)] to argue that Cenvat credit on such telephone Service has been held to be inadmissible as per Para  8 of this case law.

4. Heard both sides & perused the case records. The issue involved in this appeal is whether Cenvat credit on the telephone Services, availed at the residences of the senior officers of the appellant, is admissible when such bills are paid by the appellant. It is observed from the case laws relied upon by the appellant that right from 2006 it has been interpreted by co-ordinate benches & the high courts that Cenvat credit an mobile phones & residential landline Services is admissible. In the present case the bill landlines, installed at the residences of the Senior Officers of the appellant, are paid by the appellant. The case law of Monnet Ispat & Energy Ltd vs CCE Raipur (Supra), relied upon by the Learned AR, will not help the case of the Revenue as none of the case laws relied upon by the appellant & CBEC clarification were brought to the notice of CESTAT Delhi. In the case of keltech. Energies Ltd Vs CCE Mangalore (Supra) CESTAT held as follows in Para-4:-

4. On a careful consideration, I notice that the mobile phones and landline phones have been installed by the Company for business purpose and the bills are paid by the company. Therefore, it has to be considered as input services and that they are eligible for the benefit of the Cenvat credit, Similar issue was decided by the Mumbai bench in the bench in the case of Indian Rayons and Industries Ltd. (supra) and the Ahmadabad Bench, in the case of Excel Crop care Ltd. (supra), Wherein the benefit of input services with regard to the mobile phones have been upheld. I am of the considered view that this ratio would also apply for the landline phones installed in the Directors and Company Officials residence, as the bills are paid by the company and the telephones are used for business purpose. The appellants contention that they are eligible for the Cenvat Credit in respect of mobile/landline phones is required to be upheld. The impugned order is set aside and the appeals are allowed with consequential relief, if any. 4.1 On merits the appeal is thus required to he decided in favour of the appellant. Secondly as favouble decisions were existing during the relevant period therefore, appellant can not be considered have taken credit with intention to evade. The demand issued to the appellant in these proceedings is thus clearly time barred.

5. In view of the above observations & settled proposition of law appeal filed by the appellant is allowed with consequential relief, if any.

(Operative part of the order was pronounced in the court.)

(H.K. THAKUR) TECHNICAL MEMBER

Tushar kumar

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