This appeal assails Order-in-Original (OIO) dated 20.06.2016 passed by the Commissioner, LTU, Chennai, insofar as it disallowed CENVAT credit for the period 2010-11 to 2012-13.

2. The appellant, being registered as an Input Service Distributor (ISD), had availed and distributed credit of service tax paid on ten different type of input services used in relation to its manufacturing and business activities. Rule 3(l) of CCR, 2004 allows a manufacturer or producer of final products to take CENVAT credit of service tax paid on input service. However, it appeared to the Department that the services so availed by the appellant cannot be considered as input service and the appellant is liable to reverse the CENVAT credit so availed. After due process the Ld. Commissioner out of the total demand of Rs.69,77,323/- allowed CENVAT credit of Rs.19,83,852/- on certain services and disallowed the balance CENVAT credit of Rs.49,93,471/-. Hence this appeal.

3. The Ld. Advocate Shri Joseph Prabhakar appeared for the appellant and Ld. Authorized Representative Shri M. Selvakumar appeared for the respondent.

Submissions on behalf of the Appellant

3.1 Shri Joseph Prabhakar the Ld. Advocate for the appellant submitted as follows:

A. The entire demand is barred by limitation. The Show Cause Notice was dated 28.5.2015. For the relevant period, the normal period of limitation under Section 73(1) of the Finance Act, 1994 was one year for the period from April 2010 to 27.05.2012 and eighteen months for the period from 28.05.2012 to 31.03.2013.

B. The dispute concerns eligibility of credit on multiple categories of services under Rule 2(l) of the CENVAT Credit Rules, 2004, including services spanning the pre- and post-01.04.2011 amendment period.

C. The issue is plainly interpretational, and in such circumstances suppression or wilful misstatement cannot be alleged merely because the Department holds a different legal view. It is settled that the extended period is not invocable in matters involving bona fide interpretation of law.

D. Without prejudice, no interest or penalty survives on the alleged double availment of credit. The appellant had admittedly reversed the second credit of Rs.7,46,344/- on 30.01.2015 before utilization. Where credit is reversed before utilization, interest and penalty are not sustainable, particularly in the absence of revenue loss or mens rea.

E. Credit on car booking software is admissible. The software was used by employees for official travel and business purposes, and the related expenditure formed part of the business cost structure. Services used in the course of business and having nexus with business operations are covered by the wide expression “input service”.

F. Credit on servicing of company-owned cars and chartered aircraft is admissible where the vehicles and aircraft were used for official purposes of the company. The impugned order proceeds on an impractical requirement that the service provider’s invoice should itself mention the names and designations of the travelling officials and the precise business purpose. Such a requirement is alien to the credit scheme. Once the service is availed for official business, the nexus stands established. Credit on aircraft/helicopter related services used for business purposes has been recognized in precedent.

G. Credit on civil and interior works for the Pallavaram office is admissible to the extent the services relate to painting, carpentry, electrical work, plumbing, carpet flooring, renovation and allied interior works. Even after 01.04.2011, the exclusion in Rule 2(l) applies to construction of a building or civil structure or laying foundation/support structures for capital goods; it does not wipe out credit on modernization, renovation or repairs of existing premises. The appellant’s case is of interior/renovation and fit-out activities, not fresh construction as assumed in the impugned order.

H. Credit on demerger-related professional services is admissible. Ser