Cenvat Credit on Works Contract service availed for making changes in the production process, factory layout, and improvements to the existing facilities to increase volume ...
CESTAT disallows ‘capital goods’ / ‘inputs’ credit to telecom operators on shared towers / pre-fabricated buildings, i.e. ‘passive telecom infrastructure’ for rendering “telecommunication services”; Applies Bombay HC ratio in Bharti Airtel, observes, “….judicial discipline demands that ratio of jurisdictional High Court is to be followed by this Bench.”; Distinguishes ratio laid down in Sai Samhita Storage Ltd, SG Navratna and GTL Infrastructure Ltd on facts; Observes that in those cases, nature of output service required existence of infrastructure in place, whereas in instant case, towers / pre-fabricated buildings predominantly created & used for rendering own telecom / cellular services; Rejects assessees’ contentions that - (i) towers and shelters can be dismantled and shifted to other place, hence are movable and liable to excise duty, and (ii) credit cannot be denied even if immovable property comes into existence since it is used for providing taxable services; However, restricts demand to normal period of limitation and sets aside penalties absent tax evasion intention and since issue of interpretative nature : Mumbai CESTAT
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