IN THE CUSTOMS, EXCISE AND SERVICE TAX APPELLATE TRIBUNAL
WEST ZONAL BENCH, MUMBAI
Arising out of the Order-in-Appeal No.AGS (150)83/2009 Dated: 20.7.2009
Passed by the Commissioner of Central Excise & Customs (Appeals), Aurangabad
Date of Decision: 23.11.2010
LARSEN & TOUBRO LTD
Appellant Rep by: Shri Aasish Chauhan, Manager
Respondent Rep by: Shri B P Pereira, JDR
CORAM: S K Gaule, Member (T)
Garden maintenance service is an Input Service - as per the Pollution Control Board assessee is required to maintain 33% of the area of their factory under green grass plantation and this is required in relation to the manufacture of their final products and without which they cannot operate and manufacture their final products – CESTAT decision in appellants own case relied upon 2010-TIOL-497-CESTAT-MUM – supported also by Bombay HC decision in CCE, Nagpur Vs. Ultratech Cement Ltd., - ( 2010-TIOL-686-HC-MUM-ST ` ) .
Per: S K Gaule:
1. Heard both sides.
2. The appellant filed this appeal against the order-in-appeal No.AGS(150)83/09 dated 20/07/2009 whereby the Commissioner (Appeals) has disallowed them the credit of service tax paid on for garden maintenance service.
3. Briefly stated facts of the case are that the appellants are engaged in the manufacture of switches and relays and they have availed the Cenvat credit on inputs capital goods and inputs services. They had taken Cenvat credit on garden maintenance services, which were denied to them. Aggrieved by the same they filed an appeal with the Commissioner (Appeals). The Commissioner (Appeals) also disallowed the Cenvat credit on the said services; Hence this appeal.
4. The contention of the appellant is that as per the Pollution Control Board they are required to maintain 33% of the area of their factory under green grass plantation and this is required in relation to the manufacture of their final products and without which they cannot operate and manufacture their final products, therefore, it is covered in the definition of the inputs service. In support of their contention they have placed reliance on Tribunal's decision in their own case reported in - 2010-TIOL-497-CESTAT-MUM wherein Cenvat credit availed on the services have been allowed for the earlier period. They have also placed reliance on Hon'ble Bombay High Court's decision in the case of CCE, Nagpur Vs. Ultratech Cement Ltd., - ( 2010-TIOL-686-HC-MUM-ST ) = (AIT-2010-487-HC) .
5. The learned JDR reiterated the findings of the learned Commissioner (Appeals) that in case of garden maintenance service there is no nexus between the service and the manufacture of final products. In support of their contention, they have cited the decision in the case of CCE, Nagpur Vs. Manigarh Cement Works vide order No.A/632/2009/ SMB/C-IV = ( 2010-TIOL-720-HC-MUM-ST ) .
6. I have considered the submissions and perused the records. I find that the issue has already been decided in the appellant's favour by this Tribunal in their own case reported in - 2010-TIOL-497-CESTAT-MUM . The Tribunal's decision in the case of Manigarh Cement Works (supra) was prior to the decision of the Tribunal in the appellant's own case. The decision of this Tribunal in the appellant's own case is also supported by the Hon'ble Bombay High Court in the case of Ultratech Cement Ltd., (supra). In para 31 of the said order the Hon'ble Bombay High Court held as under:-
"In our opinion, the ratio laid down by the apex court in the case of Maruti Suzuki Ltd. (supra) in the context of the definition of 'input' in Rule 2 (k) of 2004 Rules would equally apply while interpreting the expression "activities relating to business" in Rule 2 (1) of 2004 Rules. No doubt that the inclusive part of the definition of 'input' is restricted to the inputs used in or in relation to the manufacture of final products, whereas the inclusive part of the definition of input service extends to services used prior to/during the course of/after the manufacture of the final products. The fact that the definition of 'input service' is wider than the definition of 'input' would make no difference in applying the ratio laid down in the case of Maruti Suzuki Ltd (supra) while interpreting the scope of 'input service'. Accordingly, in the light of the judgement of the Apex Court in the case of Maruti Suzuki Ltd., (supra), we hold that the services having, nexus or integral connection with the manufacture of final products as well as the business of manufacture of final product would qualify to be input service under Rule 2 (1) of 2004 Rules.
7. In view of the above, the learned Commissioner's order is not maintainable and is set aside, the appeal is allowed.
(Dictated in open Court)
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