Recently on 6th March 2013, The Hon’ble High Court in the case of M/s Deepak Fertilizers and Petrochemicals Corporation Ltd. vs The Commissioner of Central Excise, Belapur (2013-TIOL-212-HC-MUM-CX), held that the input service tax paid for services of erection and installation of storage tank which is located outside factory premises, can be utilized for payment of output tax i.e. CENVAT credit for the same is available.
In this regard, The Hon’ble High Court clarified that Clause (i) of Rule 3(1) of CCR, provides that the service tax should be paid on any input or capital goods received in the factory of manufacture of the final product – Such a restriction, however, is not imposed in regard to input services since the only stipulation in clause (ii) is that the input services should be received by the manufacturer of the final product. Further also, the definition of the expression ‘input service' covers any services used by the manufacturer, whether directly or indirectly, in or in relation to the manufacture of final products – words ‘directly or indirectly' and ‘in or in relation to' are words of width and amplitude.
The Copy of the case is annexed herewith for your kind probe.
