Case Law Details
Reliance Jio Infocomm Ltd. Vs Assistant Commissioner (CESTAT Mumbai)
Department urged a new ground, which was not even part of the allegations contained in the show cause notice nor part of the findings of the Commissioner (Appeals), that the definition of input contains an exclusion clause which excludes from the ambit of inputs all goods “used for making structures for support of capital goods”. The contention, therefore, is that credit cannot be taken for towers.
It is not possible to accept this contention. The telecom towers cannot be regarded as “goods used for making structures for support of capital goods”, when they are themselves structures for support of capital goods. The words “used for making” appearing in the exclusion clause cannot be ignored while construing and interpreting the said exclusion clause. Clearly, the exclusion clause seeks to cover steel items of general use such as angles, channels, bars CTD/TMT bars, which are raw materials used for making structures. Explanation 2 under the definition of ‘input’, which was inserted on 07.07.2009, specifically refers to these steel items of general use. The said Explanation reads as under:
“Explanation 2 – Input include goods used in the manufacture of capital goods which are further used in the factory of the manufacturer but shall not include cement, angles, channels. Centrally Twisted Deform (CTD) bar or Thermo-Mechanically Treated (TMT) bar and other items used for construction of factory shed, building or laying of foundation or making of structures for support of capital goods.”
Thus, as the telecom towers in the present case are not immoveable property, and since immovability of such towers was the only ground for rejection of the refund claim, it has to be held that all such items on which CENVAT credit was taken as ‘inputs’ are eligible for credit as inputs.
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