Custom, Excise & Service Tax Tribunal
G.M.R Industries Ltd vs Commissioner Of Central Excise, ... on 26 June, 2015
CUSTOMS, EXCISE & SERVICE TAX APPELLATE TRIBUNAL SOUTH ZONAL BENCH BANGALORE Appeal(s) Involved: E/978/2009-SM [Arising out of Order-in-Appeal No. 102/2009 dated 11/08/2009 passed by the Commissioner of Central Excise, Service Tax and Customs, Visakhapatnam] For approval and signature: HON'BLE MRS. ARCHANA WADHWA, JUDICIAL MEMBER 1 Whether Press Reporters may be allowed to see the Order for publication as per Rule 27 of the CESTAT (Procedure) Rules, 1982? No 2 Whether it should be released under Rule 27 of the CESTAT (Procedure) Rules, 1982 for publication in any authoritative report or not? No 3 Whether Their Lordships wish to see the fair copy of the Order? Seen 4 Whether Order is to be circulated to the Departmental authorities? Yes G.M.R Industries Ltd. Sankili (V), R. Amadalavalasa Srikakulam District - 532 440 Appellant(s) Versus Commissioner of Central Excise, Customs and Service Tax Visakhapatnam-I Central Excise Building Port Area Visakhapatnam 530 035 Andhra Pradesh Respondent(s)
Appearance:
Mr. G. Prabhakara Sastry, Consultant G.R. Kumar And Co.
No.9, Merry Life Apartments, Doctor's Colony, Peda Waltair, Visakhapatnam 530 017 Andhra Pradesh For the Appellant Mr. Pakshi Rajan, AR For the Respondent Date of Hearing: 26/06/2015 Date of Decision: 26/06/2015 CORAM:
HON'BLE MRS. ARCHANA WADHWA, JUDICIAL MEMBER Final Order No. 21490 / 2015 Per: ARCHANA WADHWA The appellants have been denied the benefit of cenvat credit of service tax of Rs. 97,920/- (Rupees Ninety Seven Thousand Nine Hundred and Twenty only) in respect of the service tax paid as consultancy fees to M/s. NABARD for preparation of the draft project report for maize processing and dairy units. The appellant was already registered as a manufacturer of sugar and molasses and wanted to extend their manufacturing operations so as to utilize the surplus electric power as also the land. The said credit was availed in September 2005.
2. By way of issuance of show-cause notice dated 13.10.2008, the Revenue proposed to deny the credit on the ground that the same cannot be considered to be covered by the definition of input services. The said proposal stands confirmed by the orders passed by the lower authorities.
3. After hearing both the sides I find that admittedly the service tax was paid by the assessee on the services obtained from NABARD in relation to preparation of draft project report for maize processing and dairy units, in the same factory, in which the appellant was manufacturing sugar and molasses. The definition of input services includes the services used in relation to setting up of factory. The draft project report prepared by M/s. NABARD was in respect of individual setting up of part of the factory and as such can be held to be covered by the said definition. Further the said explanation used the expression that any activities relating to business would also be covered by the definition of input services. The said phrase i.e. activities relating to business was the subject matter of the Honble Bombay High Court decision in the case of Coca Cola India Pvt. Ltd. Vs. CCE, Pune-III [2009 (15) S.T.R. 657 (Bom.)] and it was held that the expression business is an integrated continuous activity and not confined or restricted to mere manufacture of product. Activities in relation to business can cover all activities relating to functioning of a business and the said term cannot be given a restricted meaning inasmuch as the same is of wide import in fiscal statutes. As such I am of the view that the said activity being in relation to the appellants business and in relation to setting up of a factory has to be held as covered by the definition of input service.
4. Apart from that I find that the demand stands raised by invoking the longer period of limitation. The credit was availed by the appellant, by reflecting the same in the statutory records as also in the monthly returns. As such no malafide can be attributed to the appellant so as to invoke the longer period. Accordingly I hold the demand is barred by limitation also.
5. Appeal is thus allowed on merits as also on limitation, with consequential relief to the appellant, if any.
(Order pronounced in open court) (ARCHANA WADHWA) JUDICIAL MEMBER iss