RELIANCE INFRATEL LTD. Vs. COMMISSIONER OF SERVICE TAX

JUDGEMENT

(1.) THE appellant are in appeal against Order -in -Original No. 47/ST -II/RS/2014 dt. 23.06.2014 & OIO No. 82/ST -II/RS/2013 dated 29.11.2013 passed by the Commissioner of Service Tax, Mumbai -II.

(2.) The facts of the case are that during the course of the audit by the officers of Service Tax Commissionerate -II, Mumbai, it was observed that the assessee had wrongly availed and utilized CENVAT credit on goods viz. Bracket, Mounting Pole, Mount Clamps, Cable, Prefabricated Buildings/Shelter/Panel etc. falling under Chapter 39, Chapter 72, Chapter 73, Chapter 87 Chapter 91 and Chapter 94 of the Central Excise Tariff Act, 1985 (CETA) claiming them to be "Capital Goods". These goods were used in erection/fabrication of Telecom Towers. Telecom Towers are fixed to earth and become an immovable property which are neither chargeable to excise duty nor payment of service tax. These Telecom Towers are used on shareable basis by various Telecom companies for providing Telecom Service for a consideration. The appellant paid service tax under the category of "Business Support Service" for providing passive telecom infrastructure by way of Telecom towers, to various cellular telecom operators. It appeared to Revenue that the said goods are not covered in the ambit of Capital Goods in terms of the definition of "Capital Goods" provided under Rule 2(a)(A)(i) of the CENVAT Credit Rules, 2004 (CCR). Therefore, they were not eligible for CENVAT credit of excise duty paid on such goods claiming them to be "Capital Goods."

(3.) HEARD both sides.