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2014 (3) TMI 159 - AT - Central ExciseCenvat Credit of service tax paid on GTA service - transportation of cement from the depots to the customer’s premises - upto the place of removal - extended period of limitation - Held that:- So far as the Cenvat Credit demand for the period prior to 01.04.08 is concerned, irrespective of the merits of the Appellants case for this period, the longer limitation period under proviso to section 11 A(1) of Central Excise Act, 1944 would not be invokable, as during the period of dispute there were conflicting judgments on the point of admissibility of Cenvat Credit of service tax paid on GTA Service availed for transportation of finished goods from the factory gate/depot to the customer’s premises. Demand for period with effect from 01.04.2008 - Held that:- the definition of various terms including place of removal given in Section 4(3) are for the purpose of this section only, which is applicable only when the rate of duty chargeable on the excisable goods is with reference to their value and neither the tariff value have been fixed by the Government under section 3(2) for those goods, nor those goods have been notified for determining value on the basis of their MRP under section 4A. Therefore, when the duty on the finished goods is chargeable at ad-valorem rate on value determined under section 4, only then the definition of place of removal as given in section 4(3)(c) can be adopted for the purpose of Cenvat Credit Rules, 2004 and in other cases the natural meaning of the expression place on removal i.e. the place on removal from which the duty on the goods is liable to be paid i.e. the factory gate or Bonded Warehouse, which would have to be adopted. When the place of removal has been defined under section 4(3)(c) for the purpose of determining value under section 4, in our view the definition of place of removal , cannot be adopted for Cenvat Credit Rules, 2004 when the duty on the finished goods is at specific rate or is chargeable at ad-valorem rate on the tariff value fixed under section 3(2) or on value determined under section 4A in which cases the definition of place of removalin Section 4(3)(c) is not relevant. The interpretation of Rule 2(t) of the Cenvat Credit Rules, 2004, which is in conflict with the provision of Central Excise Act, 1944, has to be avoided. For the period w.e.f. 01.04.08, while Cenvat Credit of service tax paid on the GTA Service availed for transportation of the finished goods up to the place of removal would be admissible, the definition of place of removal, as given in section 4(3)(c) would be applicable only in the cases where the rate of duty on the finished goods is chargeable at ad-valorem rate on the value determined under section 4 and in other cases the place of removal would be the factory gate. Where the rate of duty is specific, the place of removal would be the factory gate and as such there would be no question of permitting Cenvat Credit of service tax paid on GTA Service availed for outward transportation of the cement from the factory to Depot/Dump or the Customer’s Premises. The duty demand in these appeals would have to be worked out by this criteria for which these matters would have to be remanded. - Demand confirmed for the normal period of limitation - No penalty would be levied - Decided partly in favor of assessee.
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