Tuesday, 19 September 2017

CESTAT : CENVAT credit availment towards manufacturing cannot debar exemption for factory space

CESTAT extends service tax exemption to manufacturer under Notification No. 6/2005-ST in respect of renting of open space within factory, finding no violation of any conditions stipulated therein with respect to non-availment of CENVAT credit; Observes that assessee had neither received / used any capital goods at the premises rented out nor utilized inputs / input services and no credit thereto was availed; Hence, all conditions thereunder stood complied with by assessee; Holds that availment of CENVAT credit in respect of inputs, input services and capital goods only in relation to manufacturing activity does not debar assessee from availing exemption under said Notification for service of renting of immovable property; Stating that activity in manufacturing unit and service related to immovable property are two distinct activities, CESTAT concludes that assessee is not liable to pay any service tax  : Mumbai CESTAT

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