Page 178 - GSTL_3rd September 2020_Vol 40_Part 1

112 GST LAW TIMES [ Vol. 40
ance of one’s business, unless restricted by Section 17 of the
CGST Act, 2017.
o Since railway siding is essential/integral for transport of ma-
terials for the assessee to carry on its operations, credit of tax-
es paid on railway siding should be construed for use in the
course or furtherance of business and used for making out-
ward supply.
o It is to be kept in mind that the words used in the explanation
are “used for making outward supply” and not “directly
used in making outward supply”. Any input/input service,
even if remotely essential, should be considered as eligible for
credit.
o Also, unlike under the pre-GST law, inputs/input services
were to be used “in or in relation to the manufacture” or “in
the factory by the manufacturer”, Section 16 of the CGST Act,
2017 allows credit of taxes paid on inputs/input services
“used or intended to be used in the course or furtherance of
business.” The said expression is of the widest possible im-
port and is in keeping with the spirit of the GST law to allow
seamless flow of credit.
(ar) The Appellant relied upon the following case laws, although under
the erstwhile indirect tax regime to support their submissions :-
o In CCE v. Solaris Chemtech Ltd., 2007 (214) E.L.T. 481 (S.C.),
examining the phrase “in relation to manufacture”, the Su-
preme Court observed that the said phrase has been used to
widen the scope and contents of the expression “inputs” and
allowed credit of taxes paid on Low Sulphur Heavy Stock
(LSHS) and furnace oil used in generation of electricity,
which was further used in the manufacture of caustic soda.
o In Oblum Electrical Industries Private Limited v. Collr. of Cus.,
Bombay - 1997 (94) E.L.T. 449 (S.C.), the Supreme Court held
the expression “material required for manufacture” would
also bring within its ambit material (which though not used
in the manufacture) is required for the purpose of manufac-
ture.
o In Commissioner of Customs, Kolkata v. Rupa and Co. Ltd. - 2004
(170) E.L.T. 129 (S.C.), the SC observed that “goods required
for the manufacture of” used in the exemption notification is
of very wide import and includes not only the material which
directly goes into the manufacturing process but also the ma-
terial necessary for the act of ultimate manufacture.
o In Industrial Machinery Manufacturers Private Limited v. State of
Gujarat, (1965) 16 STC 380, the Gujarat High Court held that
the humidifiers used in order to maintain certain humidity
for the purpose of the strength of the yarn should be regard-
ed as machinery used in manufacture of goods and that it
was not necessary to show that it was used in the actual pro-
cess of manufacture.
o GTL Infrastructure Ltd. v. CST, Mumbai in 2015 (37) S.T.R. 577
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