Home Case Index All Cases Central Excise Central Excise + AT Central Excise - 2021 (8) TMI AT This
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2021 (8) TMI 1116 - AT - Central ExciseWrongful availment of CENVAT Credit - outward freight - sale on FOR basis - place of removal - extended period of limitation - HELD THAT:- As far as interpretation under the Central Excise laws is concerned, the “transfer of possession with title of goods by one person to another” is the crux of the sale transaction. Therefore, until and unless the goods are delivered to the buyer, and the possession with title of goods is transferred unto the buyer, the sale does not take place and it cannot be said that goods have been sold. Though it may not always be the physical delivery and physical possession. Present is the case of F.O.R. destination sales. It therefore becomes important to understand its meaning. Section 19 of the Sale of Goods Act, 1930 explains as to when property in goods passes. F.O.R. destination means the seller retains the risk of loss until the goods reach the buyer. Historically this term was used only to refer goods transported by ships to U.K. but it has since been expanded to include all types of transportations. F.O.R. destination as different from FOB origin means that the seller retains the risk of goods until the goods reach the buyer - The possession in the goods remain with the seller during the transit, and the possession is transferred to the purchaser only when the goods reach him. Since the buyer had a right to reject the goods after receiving them at his place and he was supposed to make the payment at his place, that too after inspecting the goods also. Also since the appellant had a right to sell the goods to someone else, before the goods reach to the buyer at his destination, it become ample clear that the control and possession of propriety in the goods remained with the appellant till they reach the place of his buyer. Hence when appellant engaged the transporter, he instead of his buyer becomes the service recipient of freight / transport service, and the same, becomes his input. The circular dated 08.06.2018 also cannot be made retrospectively applicable to the period in question (April 2015 to June, 2017). At the relevant time, circular No. 988/12/2014 CX dated 20.10.2014 / Circular No. 97/8/2007-CX dated 23.8.2007 were applicable. It has been time and again been settled by the Hon’ble Supreme Court that the beneficial circular cannot be retrospectively withdrawn. Consequently benefit of the said circular shall continue to be available to the appellant. Extended period of limitation - HELD THAT:- It is apparent on record that credit has been shown in the ER-1 returns filed by the appellant from time to time. Neither suppression nor misrepresentation of facts can be alleged against the appellant. The alleged suppression of facts on part of the appellant that too with an intent to evade payment of duty is therefore not sustainable. It is accordingly held that the Department was not entitled to invoke the extended period of limitation. Appeal allowed - decided in favor of appellant.
|