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2016 (4) TMI 189 - AT - Central ExciseCenvat credit of the service tax paid on transportation of goods - Whether Cenvat Credit is admissible in respect of service tax paid on transportation of the goods cleared from the places for delivery at the place of the buyer as per the terms of the contract of sale between the parties prior to 01.04.2008 and thereafter? - “from the place of removal” and “upto the place of removal” - Held that:- In substance, the service recipient of the transportation is called the person liable to pay service tax. Once service tax is levied under Section 66 of the Finance Act, 1994 that becomes admissible credit for the grant under the scheme of Cenvat Credit Rules, 2004. Therefore, the service tax paid in terms of the reverse charge mechanism under Section 68 of the Finance Act, 1994 read with Section 19 of the Sale of Goods Act, 1930 and the circular aforesaid becomes input service to fulfill contractual obligation. That does not disentitle the tax payer to the Cenvat credit of the service tax paid in respect of transport service availed to make delivery of goods at the destination which otherwise would make the rule of cascading effect otios and export shall be taxable. That is not permitted. Even for this reason also the assessees are entitled to Cenvat credit. So far as the export of goods are concerned, following the aforesaid rationale, the service tax paid availing transportation service shall be admissible to the Cenvat credit or refundable where that is not possible to be set off against future liability. It is also submitted in the Bar that C&F and CHA services were availed for export of the goods. Following the ratio laid down in the case of Western Agencies Pvt. Ltd. Vs Commissioner of Central Excise, Chennai (2011 (3) TMI 528 - CESTAT, CHENNAI (LB)), the service tax paid in respect of those services shall entitle the assessees to avail Cenvat credit. Learned Adjudicating Authority concerned shall dispose of claims of the appellants on the issues of Cenvat credit granting fair opportunity of hearing to them and examining relevant evidence in each case following aforesaid guidelines shall pass reasoned and speaking order. If there are any other claims other than the Cenvat credit , C&F and CHA service, such issues shall be dealt by the authority in accordance with law considering pleadings, evidence and law.
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