Article 8

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Input Service - A New Jigsaw Puzzle w.e.f. 1-4-2011

1 Cenvat Credit is available on input goods, input services and capital goods. Manufacturer as

well as service provider will be eligible to get Cenvat credit of ‘input services’.

Definition of ‘input service’ has been changed w.e.f. 1-4-2011. The new definition is significantly

different from the earlier definition of ‘input service’.

Rule 2(l) of Cenvat Credit Rules (as effective from 1-4-2011), defines ‘input service’ as follows –

“Input service” means any service, -

(i) used by a provider of taxable service for providing an output service; or

(ii) used by a manufacturer, whether directly or indirectly, in or in relation to the manufacture of

final products and clearance of final products upto the place of removal,

and includes services used in relation to modernisation, renovation or repairs of a factory,

premises of provider of output service or an office relating to such factory or premises,

advertisement or sales promotion, market research, storage upto the place of removal,

procurement of inputs, accounting, auditing, financing, recruitment and quality control, coaching

and training, computer networking, credit rating, share registry, security, business exhibition,

legal services, inward transportation of inputs or capital goods and outward transportation upto

the place of removal;

but excludes services, -

(A) specified in sub-clauses (p), (zn), (zzl), (zzm), (zzq), (zzzh) and (zzzza) of clause (105) of

section 65 of the Finance Act (hereinafter referred as specified services), in so far as they are

used for- (a) construction of a building or a civil structure or a part thereof; or (b) laying of

foundation or making of structures for support of capital goods, except for the provision of one

or more of the specified services; or

(B) specified in sub-clauses (d), (o), (zo) and (zzzzj) of clause (105) of section 65 of the Finance

Act, in so far as they relate to a motor vehicle except when used for the provision of taxable

services for which the credit on motor vehicle is available as capital goods; or

(C) such as those provided in relation to outdoor catering, beauty treatment, health services,

cosmetic and plastic surgery, membership of a club, health and fitness centre, life insurance,

health insurance and travel benefits extended to employees on vacation such as Leave or Home

Travel Concession, when such services are used primarily for personal use or

consumption of any employee.

1-1 Analysis of the definition

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The definition of ‘input service’ is broadly in three parts – First is main part, second is inclusive

part and third part covers exclusions. First part of the definition is restrictive in scope as it

covers input services used for providing taxable output service or used by manufacturer, directly

or indirectly, in relation to manufacture or clearance of final product upto the place of removal.

Second i.e. inclusive part of the definition expands the scope much beyond the coverage of first

part. The third part covers specific exclusions.

1-2 Meaning of ‘includes’

Definitions are ‘inclusive’ or ‘exhaustive’. If the definition uses the word “means” it means that it

is restrictive and exhaustive. However, if the word “include/s” is used in definition, it means that

the definition is not exhaustive but it is inclusive, i.e. it expands the meaning - Doypack Systems

(P.) Ltd. v. UOI (1988) 2 SCR 962 = (1988) 2 SCC 299 = 65 Comp Cas 1 = 36 ELT 201 = AIR

1988 SC 782 * Lucknow Development Authority v. M K Gupta (1994) 1 SCC 243 = 1994 AIR

SCW 97 = AIR 1994 SC 787 = 80 Comp Cas 714 (SC) * Feroze N Dotivala v. P M Wadhwani

2002 AIR SCW 4904.

In Corporation of City of Nagpur v. Its Employees AIR 1960 SC 675, it was held : ‘The inclusive

definition is a well recognised devise to enlarge the meaning of the word defined, and, therefore,

the word defined must be construed as comprehending not only such things as it signifies

according to its natural import but also those things the definition declares that it should include’ -

similar views in RD, ESIC v. Highland Coffee Works - (1991) 3 SCC 617 = AIR 1991 SC 129 =

1991 AIR SCW 2821 (3 member bench) * CIT v. Taj Mahal Hotel - (1971) 3 SCC 550 = AIR

1972 SC 168 = (1971) 82 ITR 44 (SC) * Municipal Corporation v. Indian Oil Corpn - AIR 1991

SC 686 = (1991) Supp 2 SCC 18 * S K Gupta v. K P Jain (1979) 3 SCC 54 * Narmada Bachao

Andolan v. UOI AIR 2005 SC 2994 (SC 3 member bench) * CTO v. Rajasthan Taxchem Ltd.

(2007) 3 SCC 124 = 5 VST 529 = 209 ELT 165 (SC) * Karnataka Bank Ltd. v. State of AP

(2008) 12 VST 459 (SC) * K N Farms Industries v. State of Bihar AIR 2009 SC 3031.

In Forest Range Officer v. P Mohammed Ali - AIR 1994 SC 120 = 1993 AIR SCW 3754 = 1993

(3) SCC (Supp) 627, it was observed : ‘Includes’ is used as extension. An interpretation clause

which extends the meaning of a word does not take away its ordinary meaning. An interpretation

clause of inclusive definition is not meant to prevent the word receiving its ordinary, popular and

natural sense wherever that would properly be applicable, but to enable the word as used in the

Act to be applied to some things to which it would be normally not applicable’ - same view in

Black Diamond Beverages v. CTO 1997 AIR SCW 3654 = (1997) 107 STC 219 (SC) = AIR

1997 SC 3550, where it was held that inclusive part of definition cannot prevent the main

provision from receiving its natural meaning.

When the word used is ‘includes’, such definition is to be given a wider meaning and not

exhaustive or restricted to the items contained in the definition - Krishi Utpadan Mandi Samiti v.

Shanker Industries - 1993 AIR SCW 762 = 1993 Supp (3) SCC 361(II) (SC) * Tamil Nadu

Kalyana Mandapam Association v. UOI 2004 (167) ELT 3 = 4 STT 308 = 267 ITR 9 = 136

Taxman 596 = 135 STC 480 (SC) * Ponds India v. CTT (2008) 227 ELT 497 = 15 VST 256

(SC).

IDecision in Maruti Suzuki restricting scope of ‘includes’ doubted and issue referred to

large bench - In Maruti Suzuki Ltd. v. CCE (2009) 9 SCC 193 = 22 STT 54 = 240 ELT 641

(SC),restricted meaning to word ‘includes’ in definition of ‘input’ under Cenvat Credit Rules was

given and it was held that even in respect of second i.e. inclusive part of definition of ‘input’,

relation with ‘manufacture’ is required – in appeal from Maruti Suzuki Ltd. v. CCE (2009) 238

ELT 180 (CESTAT). [This view has been doubted and the matter has been referred to a large

bench in Ramala Sahkari Chini Mills v. CCE (2010) 29 STT 464 = 8 taxmann.com 122 = 260

ELT 321 (SC)]

1-3 Meaning of ‘in relation to’


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Scope of inclusive part of definition of input service is further widened by use of the term ‘in

relation to’.

The expression ‘in relation to’ (so also ‘pertaining to’) is a very broad expression, which

pre-supposes another subject matter. These are words of comprehension which might both have

a direct significance as well as an indirect significance depending on the context. -. - ‘Relating to’

is equivalent to or synonymous with as to ‘concerning with’ and ‘pertaining to’. The expression

‘pertaining to’ is an expression of expansion and not of contraction - Doypack Systems P Ltd. v.

UOI (1988) 2 SCR 962 = 1988 2 SCC 299 = (1989) 65 Comp Cas 1 = 1988 (36) ELT 201 (SC)

= AIR 1988 SC 782 * Tamil Nadu Kalyana Mandapam Association v. UOI 2004 (167) ELT 3 = 4

STT 308 = 267 ITR 9 = 136 Taxman 596 = 135 STC 480 (SC) CCE v. Solaris Chemtech

(2007) 7 SCC 347 = 9 STT 412 = 214 ELT 481 (SC).

'In relation to' are words of comprehensiveness which might have both a direct significance or

indirect significance depending on the context. They are not words of restrictive content. - State

Waqf Board v. Abdul Azeer Sahib (1967) 1 MLJ 190 = AIR 1968 Mad 79 * State of Karnataka v.

Azad Coach Builders (2010) 9 SCC 524 = 7 taxmann.com 28 = 4 GST 72 = 36 VST 1 = 262

ELT 32 (SC 5 member bench).

The expression ‘in relation to’ is of widest import. – Thyssen Stahlunion GMBH v. Steel

Authority of India 1999 AIR SCW 4016 = AIR 1999 SC 3923 = 1999 (6) SCC 334.

2 Place of removal

The concept of ‘removal’ is borrowed from Central Excise and hence applies only to a

manufacturer and not service provider.

CBE&C vide circular No. 137/3/2006-CX.4 dated 2-2-2006 has confirmed that when the words

‘place of removal’ are not defined in Finance Act, definition under Central Excise Act is to be

considered. It has been clarified that in case of depot sale, depot is place of removal. Hence,

service tax on freight upto depot will be eligible for Cenvat credit whether the duty is payable

under section 4 (ad valorem) or section 4A (MRP basis).

The term ‘place of removal’ is not defined in Cenvat Credit Rules, but is defined in section

4(3)(c) of Central Excise Act as follows –

“Place of removal” means—

(i) a factory or any other place or premises of production or manufacture of the

excisable goods;

(ii) a warehouse or any other place or premises wherein the excisable goods have

been permitted to be deposited without payment of duty;

(iii) a depot, premises of a consignment agent or any other place or premises from

where the excisable goods are to be sold after their clearance from the factory

from where such goods are removed.

The words ‘from where such goods are removed’ apply to all the three clauses.

As per section 2(h) of Central Excise Act, ‘sale’ and ‘purchase’ with their grammatical variations

and cognate expressions, means any transfer of possession of goods by one person to another

in the ordinary course of trade or business for cash or deferred payment or other valuation

consideration.

2-1 Place of where ownership gets transferred to buyer is place of removal when there is

direct sale from factory


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Normally, factory gate is place of removal, except in case of depot sales.

In Escorts JCB Ltd. v. CCE (2003) 1 SCC 281 = 53 RLT 1 = 146 ELT 31 (SC), the contract was

for sale ex-factory. Goods were handed over to the carrier/transporter. However, insurance was

arranged by assessee, though charged separately. It was contended by department that since

insurance is arranged by seller, the property in goods passes to buyer only when goods reach

the destination. Hence, buyer’s place will be the ‘place of removal’ and hence insurance and

freight will be includible in the price. This view was rejected by SC. It was held that as per

section 39 of Sale of Goods Act, delivery of goods to carrier is prima facie delivery of goods to

buyer. Ownership in the property may not have relevance in so far as insurance of goods sold

during the transit is concerned. It is not necessary that insurance of the goods and ownership of

goods must always go together. [Reversing decision of CEGAT in Escorts JCB Ltd. v. CCE

2000(118) ELT 650 = 35 RLT 9 (CEGAT)]

However, if ‘sale’ i.e. takes place when ownership in goods is transferred to buyer at

destination, that will be the ‘place of removal’ (except in case of depot sales).

2-2 ‘Place of removal’ if ownership is transferred at destination

In Escorts JCB Ltd. v. CCE 2000(118) ELT 650 = 35 RLT 9 (CEGAT), it was observed, in

respect of provisions under old section 4, as follows - 'Place where excisable goods are sold

can be place of removal. A place where goods are sold can be a place where the property in

goods sold passes from buyer to seller. If goods are sold only when they reach the destination,

that will be the place of removal’. – view confirmed in CCE v. Prabhat Zarda Factory Ltd.

2000(119) ELT 191 = 38 RLT 637 (CEGAT 5 member bench), where it was held that as per

definition of 'sale' u/s 2(h) of CEA, transfer of possession of goods is the essence of sale. [In

my opinion, though decision in case of Escorts JCB has been reversed by SC on different

ground, the principle discussed above is still valid].

In Ambuja Cements v. UOI (2009) 236 ELT 431 (P&H HC DB), it has been held that if freight

charges form part of assessable value, price is FOR destination, if ownership of goods remains

with seller till delivery at customer’s doorstep, transit insurance is borne by assessee and

property in goods is not transferred till delivery, outward transportation is ‘input service’ and is

eligible for Cenvat credit. (thus, the customer’s place will be ‘place of removal’).

2-3 Port is place of removal in case of exports

In case of exports, the place of removal is port where export documents are presented to

customs office – Kuntal Granites v. CCE (2007) 215 ELT 515 = 2007 TIOL 930 (CESTAT) –

quoted and followed in Rajasthan Spinning & Weaving Mills v. CCE (2007) 8 STR 575

(CESTAT).

Port is the place of removal in exports as property gets transferred to buyer at port – RSWM v.

CCE (2008) 223 ELT 481 (CESTAT SMB) * CCE v. Adani Pharmachem (2009) 19 STT 239 =

238 ELT 179 (CESTAT SMB) * Modern Petrofils v. CCE (2010) 253 ELT 609 (CESTAT SMB) *

Cauvery Stones v. CCE (2010) 24 STT 400 = 257 ELT 152 (CESTAT SMB).

In CCE v. Rolex Rings (2008) 230 ELT 569 (CESTAT SMB), it has been held that in case of

exports, port is the ‘place of removal’ as exporter continues to be owner of goods till the same

are exported. Hence, CHA and surveyor services which are relating to export business are

eligible for Cenvat credit.

2-4 Meaning of ‘Warehouse’

If goods are sold from warehouse, that will be treated as ‘place of removal’ in terms of section

4(3)(c)(ii). In such case, transport, handling and insurance charges upto warehouse incurred by

assessee will be includible in the Assessable Value.

The term ‘warehouse’ has restricted meaning. It is confined only those warehouses which are


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notified under rule 20, where goods can be kept without payment of duty – Roha Dyechem v.

CCE 2005 (179) ELT 39 (CESTAT SMB).

3. Services specifically excluded from definition of ‘input service’

Some services have been specifically excluded from definition of ‘input service’. These would not

be eligible even if these would be eligible as per inclusive part of the definition of ‘input service’.

3.1 Services specifically excluded under clause (A)

Following services have been specifically excluded from definition of ‘Input Services’, if they are

used for construction of a building or a civil structure or a part thereof, or laying of foundation or

making of structures for support of capital goods The aforesaid services are termed as

‘specified services’ for purpose of this sub-clause] –

* Architect Services [Section 65(105)(p)]

* Port Services [Section 65(105)(zn)]

* Other Port Services [Section 65(105)(zzl)]

* Airport Services [Section 65(105)(zzm)]

* Commercial or Industrial Construction [Section 65(105)(zzq)]

* Construction of Residential Complex [Section 65(105)(zzzh)]

* Works Contract Service [Section 65(105)(zzzza)]

These ‘specified services’ will be eligible for Cenvat credit only if used for any of these ‘Specified

Services’. e.g. Architect Service will be eligible as input service if used for Port Service or

Construction Service or Works Contract Service.

Further, these services would not be eligible only if they are used for construction of a building or

a civil structure or a part thereof, or laying of foundation or making of structures for support of

capital goods. If these are used for other purposes, e.g. finishing services, repair, alteration or

restoration, these should be eligible.

Port or airport services provided to aircraft or renting would be eligible.

3.2 Services specifically excluded under clause (B)

Following services are excluded from definition of ‘input service’ only so far as they relate to a

motor vehicle –

* General Insurance Services [Section 65(105)(d)]

* Renting of a cab [Section 65(105)(o)]

* Motor vehicle related service (earlier termed as Authorised Service Station service) [Section

65(105)(zo)]

* Supply of tangible goods [Section 65(105)(zzzzj)]

However, these services will be eligible as ‘input services’ if used for provision of taxable

services for which Cenvat credit of motor vehicle is available as capital goods.

Thus, specified input services relating to ‘motor vehicle’ are specifically excluded except in cases

where motor vehicle is eligible for Cenvat Credit as capital goods (See definition of ‘Capital


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Goods’ for Cenvat Credit).

Meaning of motor vehicle – The term ‘motor vehicle’ is not defined in Cenvat Credit Rules. As

per Central Excise Tariff Act, ‘motor vehicles’ are covered under chapter 87 of Central Excise

Tariff.

As per section 65(73) of Finance Act, 1994; ‘motor vehicle’ has same meaning as assigned to it

under section 2(28) of Motor Vehicles Act. As per that Act, ‘motor vehicle’ means any

mechanically propelled vehicle adapted for use upon roads, whether the power or propulsion is

transmitted thereto from internal or internal source and includes a chassis to which a body has

not been attached and a trailer; but does not include a vehicle run on fixed rails or a vehicle of

special type adapted for use only in a factory or in any other enclosed premises or a vehicle

having less than four wheels fitted with engine capacity of not exceeding thirty five cubic

centimeters.

Some vehicles (e.g. fork lift truck, excavators) require registration under Motor Vehicles Act, but

they fall under chapter 84 of Central Excise Tariff. Goods falling under chapter 84 are eligible for

Cenvat credit. Hence, insurance, repair services, renting etc. in respect of such vehicles should

be eligible for Cenvat credit.

3.3 Services specifically excluded under clause (C)

Certain services like outdoor catering, beauty treatment, health services, cosmetic and plastic

surgery, membership of a club, health and fitness centre, life insurance, health insurance and

travel benefits extended to employees on vacation such as Leave or Home Travel Concession

have been specifically excluded.

However, this exclusion is only when such services are used primarily for personal use or

consumption of any employee. This exclusion will not apply in other cases. For example, outdoor

catering for ‘sales promotion’ would be eligible. Club membership fee of a director (who is not

employee) would be eligible. Corporate club membership (without naming any specific

employee) should be eligible.

The condition that these services must be used primarily for personal use or consumption of

employees is essential. For example, say the company X organises Distributor’s conference in

which service of outdoor catering is obtained. In the Distributor’s conference, there will be some

employees of M/s X who will also take lunch or dinner along with the distributors. The services

are not primarily meant for personal use. The services of outdoor catering are provided as

incidental to Distributor’s conference. Therefore, the credit of service tax paid on such outdoor

catering would be available as credit to M/s X.

4. What is wasteful expenditure as per the revised definition of input

service

As per the revised definition of input service, following is the wasteful expenditure and do

not deserve any Cenvat credit, as per department’s view.

* Factory and office building (We are a free society. Indians do every conceivable thing in

open. Hence, department is of vies that production or provision of service or

administration should be done in open)

* Motor vehicle is a luxury even if used to transport employees or for business purposes

[Sales and purchase people can either go by bus or by air since air travel can be

allowable input service]


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* All employee benefits line transport, canteen facility, health care, insurance, welfare

expenditure is a pure waste [Company should employ only casual labour at minimum

wages with no benefits].

5. Eligibility of various services as input services

Based on aforesaid discussions, following is summary of various input services eligible and not

eligible. Of course, litigation is inevitable in many cases.

Service Comment about eligibility

Accounting Expenses Eligible as specifically

included in definition

Advertisement (may be for

recruitment, tenders, sales

promotion, legal notices etc. as

no restriction)

Eligible as specifically


Air travel of employees Eligible if in relation to

manufacture or provision of

taxable goods/services,

modernization or repairs of

factory or office, storage,

quality control, recruitment,

accounts, audit, sales

promotion, procurement of

inputs, legal services,

financing, computer

networking

Airport Service Not eligible if used for

construction of a building or a civil

structure or a part thereof, or

laying of foundation or making of

structures for support of capital

goods. If the service is used for

other purposes, e.g. for aircrafts,

provided to importer/exporter or

to CHA, it would be eligible.

The service is also eligible in

case of construction or works

contract services or port or

airport services.

Architect Services Not eligible if used for





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other purposes, e.g. finishing

services, repair, alteration or

restoration, these should be

eligible.




airport services.

Auditing Service Eligible as specifically


Authorised Service Station See under Motor vehicle

Related services (as per new

definition)

Banking and other financial

services

Eligible under ‘Financing’

Beauty Treatment Specifically excluded – Hence

not eligible

Brand Ambassadors Eligible as relating to ‘sales

promotion’

Business exhibition Eligible as specifically


Business Support Service Eligible if in relation to









financing, computer

networking

Canteen Expenses for

employees

Not Eligible as specifically

excluded

Clearing & Forwarding Agent Eligible for inputs and for final

products upto place of

removal (port is place of

removal for export)

Club Membership Specifically excluded for

employee – Hence not eligible

[Club membership fee of a


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director (who is not employee)

would be eligible. Similarly,

corporate membership of a club

(not in name of any particular

employee) should be eligible]

Commercial Coaching and

training



Commission Agent Eligible as relating to ‘sales

promotion’ or ‘procurement of

inputs’

Computer networking Eligible as specifically


Consignment Agent’s expenses Eligible as consignment

agent’s place is ‘place of

removal’ when sale is from

depot

Construction of a building or a

civil structure or a part thereof

Not eligible if used for









eligible.




airport services.

Construction of residential

complex

Not eligible if used for









eligible.




airport services.

Consulting – Engineering,

management

Eligible if in relation to



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financing, computer

networking

Courier Eligible if related to


factory or office, accounts,

financing, procurement of

inputs, sales promotion,

inward and outward

transportation, share registry,

recruitment, legal services

Credit rating Eligible as specifically


Customs House Agent Eligible for procurement of

inputs and also for exports as

port is place of removal for

export

Depot expenses Eligible as depot is ‘place of

removal’ when sale is from

depot. In other cases, may be

eligible as ‘sale promotion’

Erection, commissioning or

installation

Eligible since in relation to


taxable goods/services

Financing (Bank charges,

Lease, Hire Purchase)



Foundation or support of

capital goods

Specifically excluded – Hence

not eligible except for

construction or works contract

service

Gardening Eligible only if done as a

statutory requirement (since it

can be argued that the service

is used in relation to

manufacture, as manufacture

would be impossible if the

statutory requirement is not

met) or if in relation to

modernization or renovation of


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factory or office, otherwise not

eligible.

General Insurance for

machinery, building and

transportation of inputs,

capital goods and final


removal (except motor vehicle

– see discussions above for

meaning of ‘motor vehicle’)

Eligible as in relation to

manufacture, provision of

taxable services, procurement

of inputs, transportation of

inputs and final products

General Insurance of motor

vehicles


not eligible except where

motor vehicle is eligible as

capital goods – see discussions

above for meaning of ‘motor

vehicle’

Health Insurance Insurance of employees not

eligible [Insurance of a director(who is not employee) would be

eligible]

Hire purchase Eligible under ‘Financing’

Information Technology

Software




moderniaation or repairs of






financing, computer

networking

Insurance for machinery,

building and transportation of

inputs, capital goods and final


removal (except insurance of

motor vehicle)

Eligible as in relation to

manufacture, provision of

taxable services, procurement

of inputs, transportation of

inputs and final products.

Insurance (Life or Health) Insurance of employees not


eligible]

Intellectual Property Service Eligible if in relation to


taxable goods/services, quality


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control, sales promotion,

computer networking

Inward transport Specifically included under

’Inward transportation of inputs

or capital goods’

Job work Eligible if in relation to





quality control, computer

networking

Labour contractor Eligible if in relation to


service or modernization or

repairs of factory or office,

accounts, financing,

procurement of inputs, sales

promotion, inward and

outward transportation, share

registry, recruitment, legal

services

Leasing Covered under ‘Financing’.

Hence eligible

Legal Consultancy Specifically included under

‘legal services’

Life Insurance Insurance of employees not


eligible]

Maintenance and repairs Eligible if in relation to





quality control, except of

motor vehicles (see

discussions above for meaning

of ‘motor vehicle’)

Mandap Keeper Eligible if in relation to

recruitment, accounts, audit,

sales promotion, procurement

of inputs, legal services,

financing, computer

networking


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Manpower recruitment and

supply





factory or office, recruitment,

storage, quality control,

accounts, sales promotion,

financing, computer

networking

Market Research Eligible as specifically


Mobile phones (even if in

name of employees, if

endorsed in favour of

employer and reimbursed by

employer)

Eligible if related to





inward and outward


recruitment, legal services but

not for personal use of

employees

Motor Vehicle Related

Expenses (earlier termed as

authorised station services)




capital goods (see discussions


vehicle’)

Outdoor catering Not eligible when given to

employee – should be eligible

if used for sales promotion,

training, auditing (e.g. giving

lunch to auditors), legal

services, security or to

directors who are not

employees

Outward transportation Outward transportation upto

the place of removal is eligible

(see meaning of ‘place of

removal’ discussed earlier)

Personal Insurance of

employees

Not eligible

Port Service Not eligible if used for






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other purposes, e.g. provided to

CHA, ships, importers/exporters,

these should be eligible.




airport services.

Procurement Expenses Eligible under ‘Procurement of

inputs’

Quality Control Eligible as specifically


Realer Estate Agent service May not be eligible

Recruitment Eligible as specifically


Renovation of factory or

office building

Renovation of a factory,

premises of provider of output

service or an office relating to

such factory or premises is

eligible

Renting of a cab Specifically excluded – Hence



capital goods - – see

discussions above for meaning

of ‘motor vehicle’ (may be

eligible if charged by auditor,

legal adviser or consulting

engineer as part of their

services, but they themselves

will not be eligible for Cenvat

credit on these services)

Renting of immovable

property










financing, computer

networking

Repairs of factory or office

building

Repairs of a factory, premises

of provider of output service


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or an office relating to such

factory or premises are eligible

Repairs of motor vehicles Specifically excluded – Hence



capital goods – see discussions


vehicle’

Residential Colony/quarters

Expenses

Not eligible except security

and legal services

Residential Complex Specifically excluded – Hence

not eligible except for

construction or works contract

service

Sales Promotion Expenses Eligible as specifically


Security at factory, offices,

godown, residential coloniesEligible as specifically

included in definition as ‘Security’ (no restriction where

used)

Share registry Eligible as specifically


Showroom Expenses Eligible as ‘sale promotion’

Software Eligible if in relation to







promotion, financing,

computer networking

Storage of inputs and final

products


included in definition as

‘Storage upto place of

removal’

Supply of tangible goods for

use service









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financing, computer

networking.

However, supply of motor

vehicle for use is not eligible –

see discussions above for

meaning of ‘motor vehicle’.

Telephones and telephones at

residence of employees

Eligible if related to





inward and outward


recruitment, legal services but

not for personal use of

employees

Training Eligible as specifically


Transport charges for transport

of employees

Not eligible as specifically

excluded

Travel by air, road or water

except by motor vehicle










financing, computer

networking

Works Contract Service Not eligible if used for









eligible.




airport services.


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* * * * *


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Article 8

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