Case Law Details
Vodafone Mobile Services Limited Vs Commissioner Of Service Tax (Delhi High Court)
Tribunal had denied CENVAT credit to the assessee on the premise that the towers erected result into an immovable property, which is erroneous and contrary to the judgment of the Supreme Court in the case of Solid and Correct Engineering (supra). The towers which are received in CKD condition, are assembled/ erected at the site subsequently giving rise to a structure that remains immovable till its use because of safety, stability and commercial reasons of use. The entitlement of CENVAT credit is to be determined at the time of receipt of goods. The fact that such goods are later on fixed/ fastened to the earth for use would not make them a non-excisable commodity when received. Therefore, this question is answered in favour of the assessee and against the Revenue.
FULL TEXT OF THE HIGH COURT ORDER / JUDGMENT
1. In all these appeals, preferred under Section 35E of the Central Excise Act, 1944 (hereafter referred as the “Excise Act”) and Section 83 of the Finance Act, 1994 (“the Act”) the common question of law is whether parts of base transmission systems (hereafter “BTS”) are classifiable under Tariff Heading 8517 and, consequently, all components, spares and accessories qualify as capital goods in terms of Rule 2(a)(A)(iii), of the CENVAT Credit Rules, 2004 (hereafter “the Credit Rules”) regardless of whether those components, spares and accessories only fall under Chapter 85. The questions of law framed are:
i) Whether the CESTAT was right in concluding that the towers, shelter and accessories used by the Appellants for providing telecom services are immovable property?
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