Order Date – 06 February 2023

Parties: Gujarat Chemical Port Limited Vs Commissioner of Central Excise & ST, Vadodara-II

Facts – 

• The Appellant, Gujarat Chemical Port Limited claim for Cenvat credit was denied on the ground that said services were used in connection with construction of a new Jetty which fall under the ‘setting up’ of the project which is excluded as per the exclusion clause in the definition of Input Services under Rule 2(l) of Cenvat Credit Rules, 2004.

Issue –

• Whether the appellant is entitled for Cenvat credit in respect Management & Business Consultant service and Technical Inspection and certification service?

Order –

• The Tribunal observed the appellant already had Jetty in operation and they proposed to construct one more Jetty adjacent to the existing Jetty. In this case it cannot be said that the appellant are setting up altogether a new Jetty. The additional Jetty is nothing but expansion of the existing Jetty.
• Therefore, it was held that the expansion, renovation or modernization of existing jetty, construction is still covered in inclusion clause of definition of Input Service under Rule 2(l) of Cenvat Credit Rules, 2004.
• In view of the decision of the Tribunal in the case of Piramal Glass Limited, it was held that even though setting up of a new factory, construction of building of service provider is not excluded from the definition of Input service. In this case the construction of Jetty is clearly in the nature of expansion of existing Jetty therefore, credit is clearly admissible. 
• Accordingly, the impugned order is set-aside and the appeal is allowed.