2018 (7) TMI 428 - AT - Service Tax

CENVAT Credit - input services - GTA Services for outward transportation of goods - place of removal - period prior to 01.04.2008 - Held that - There is no dispute with regard to place of removal - the decision in the case of COMMISSIONER OF CUSTOMS CENTRAL EXCISE AND SERVICE TAX, GUNTUR VERSUS M/S. THE ANDHRA SUGARS LTD. 2018 (2) TMI 285 - SUPREME COURT OF INDIA is squarely applicable to the facts of present case, where it was held that Once it is accepted that place of removal is the factory premises of the assessee, outward transportation from the said place would clearly amount to input service - credit allowed - appeal dismissed - decided against Revenue.

Summary

Issues:
Appeal against Commissioner(Appeals) order allowing Cenvat Credit on Service Tax paid on GTA Services for outward transportation of goods manufactured prior to 01.04.2008.

Analysis:
1. The Commissioner(Appeals) allowed the assessee's appeal for availing Cenvat Credit on Service Tax paid on GTA Services for outward transportation of goods manufactured before 01.04.2008, relying on a Karnataka High Court decision.
2. The Hon'ble Supreme Court clarified the definition of 'input service' through Circular No. 97/8/2007-ST, emphasizing conditions for coverage under 'place of removal,' including ownership, risk-bearing, and freight charges integration.
3. The Department argued that outward transportation beyond the place of removal is not eligible for input service. However, the definition prevailing before April 1, 2008, allowed Cenvat Credit for service used in clearance of final products from the place of removal to the warehouse or customer's place.
4. The issue of 'place of removal' was examined, citing judgments of CESTAT in Gujarat Ambuja Cement Ltd. and M/s. Ultratech Cement Ltd. The eligibility for credit depends on the place of removal, which can be the factory premises or customer's place if goods are directly dispatched to the customer from the place of removal.
5. The Hon'ble Supreme Court's decision in Commissioner of Customs, Central Excise & Service Tax, Guntur v. The Andhra Sugars Ltd. was followed, rejecting the Revenue's appeal based on the clarity of the 'place of removal' in the present case.