Custom, Excise & Service Tax Tribunal
Shree Pandurang Ssk Ltd vs Commissioner Of Central Excise, ... on 7 December, 2016
IN THE CUSTOMS, EXCISE AND SERVICE TAX APPELLATE TRIBUNAL WEST ZONAL BENCH AT MUMBAI COURT NO. II APPEAL NO. E/592/12 [Arising out of Order-in- Appeal No. P-III/RS/19/2012 dated 2-2-2012 passed by the Commissioner of Central Excise (Appeals), Pune-III ] For approval and signature: Honble Mr Ramesh Nair, Member(Judicial) =======================================================
1. Whether Press Reporters may be allowed to see : No
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 : seen
of the Order?
4. Whether Order is to be circulated to the Departmental: Yes
authorities?
=======================================================
Shree Pandurang SSK Ltd
:
Appellant
VS
Commissioner of Central Excise, Pune-III
:
Respondent
Appearance
None for the Appellants
Shri. Sanjay Hasija, Superintendent (A.R.) for the Respondent
CORAM:
Honble Mr. Ramesh Nair, Member (Judicial)
Date of hearing: 7/12/2016
Date of decision: 7/12/2017
ORDER NO.
The issue involved in the present case is that appellant availed Cenvat credit in respect of input service. The input service is related to erection, installation of capital goods. The services on which credit was taken has been capitalized and depreciation was claimed. The contention of the department is that since the value of services including service tax was capitalized, the Cenvat Credit in terms of Rule 4(4) of Cenvat Credit Rules, is not admissible.
2. None appeared on behalf of the appellant however there is an adjournment letter dated 2-12-2016 placed on record by the advocate. After going through the records, I am of the view that matter can be disposed of.
3. Shri. Sanjay Hasija, Ld. Superintendent(A.R.) appearing on behalf of the Revenue reiterates the findings of the impugned order. He submits that appellant has availed double benefit. One is cenvat credit on the service tax paid on the service and second same amount has been capitalized and depreciation was also claimed therefore Cenvat credit should not be allowed in terms of Rule 4(4) of CCR, 2004.
4. I have carefully considered submissions made by Ld. A.R. and perused the record.
5. I find that Cenvat credit was availed on services related to erection, installation of the capital goods. Revenue sought denial of credit invoking Rule 4(4) of Cenvat Credit Rules, 2004 which reads as under:
Rule 4. Conditions for allowing CENVAT credit.-
(4) The CENVAT credit in respect of capital goods shall not be allowed in respect of that part of the value of capital goods which represents the amount of duty on such capital goods, which the manufacturer or provider of output service claims as depreciation under section 32 of the Income-tax Act, 1961( 43 of 1961).
On going through the above rule, it is clear that restriction in availing credit if the depreciation availed, is only in respect of capital goods and not on services. Admittedly the Cenvat credit involved in the present case is of service tax paid on the services even though it is related to erection and installation of capital goods. Since there is no explicit provisions to restrict the Cenvat credit on input services if the assessee claims depreciation, the cenvat credit cannot be denied, therefore the impugned order is set aside. Appeal is allowed.
(Pronounced in Court ) Ramesh Nair Member (Judicial) sk 3