Order Date: 22 February 2023

Parties: M/s Asrani Inns & Resorts Pvt. Ltd. vs. Commissioner of Central Goods & Service Tax

Facts – 

• The Appellant, M/s Asrani Inns & Resorts Pvt. Ltd. has constructed two hotels and availed CENVAT Credit of Service Tax paid on Architect Service, telephone expenses, security services, legal and professional service, etc.
• Later, the CENVAT credit rules were amended and the word “setting up” was deleted from the definition of input service.
• The authorities contended that the construction of hotel premises at Hyderabad and Delhi was setting up and therefore denied CENVAT Credit part.

Issue – 

• Whether the CENVAT Credit was admissible to the appellant or not?

Orders – 

• The Court relied on the case of Lemon Tree Hotel vs. Commissioner of Central Excise Hyderabad which held that CENVAT Credit on input services that are used for bringing into existence of immovable property are eligible for availing of CENVAT Credit by this Tribunal.
• The Court stated that in the present case activity was that of construction and therefore the services stated above were input services and therefore the Service Tax paid on the said services is eligible as CENVAT Credit to the appellant.
• Impugned orders are set aside. The appeal is allowed.