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2024 (2) TMI 250 - AT - Central ExciseCENVAT Credit - Input service or not - availing outward transportation service from GTA to transport the goods from the factory to customer’s premises - reverse charge mechanism - inclusion of the cost of transportation in the assessable value of the goods cleared by the Appellant - time limitation. CENVAT Credit - Input service or not - availing outward transportation service from GTA to transport the goods from the factory to customer’s premises - reverse charge mechanism - HELD THAT:- From the definition of ‘input service’ it can be seen that prior to 1.4.2008, in sub-clause (ii) any service used by the manufacturer whether directly or indirectly, in or in relation to the manufacture of final products and clearance of final products from the place of removal, is covered under the definition of input service. However, post 01.04.2008, only those services which are used upto the place of removal were covered within ambit of input services. The period involved in the present appeal is prior to 01.04.2008. The issue is considered by various judgements, which are discussed hereunder, which clearly hold that, prior to 01.04.2008, the outward transportation services were specifically covered by main body of the definition of input service, which provides for means part of the definition and it is not necessary to examine the inclusive part of the definition of input services. The Hon’ble Apex Court in COMMISSIONER OF CUSTOMS CENTRAL EXCISE AND SERVICE TAX, GUNTUR VERSUS M/S. THE ANDHRA SUGARS LTD. [2018 (2) TMI 285 - SUPREME COURT], in paragraph 8 clearly holds that “once it is accepted that the place of removal is the factory premises of the assesee, the outward transportation from the said place would clearly amount to input services. That place can be warehouse of the manufacturer or it can be customer’s place if from the place of removal the goods are directly dispatched to the place of the customer. One such outbound transportation from the place of removal gets covered by the definition of input service.’ - the Appellant is entitled to CENVAT credit of service tax paid under RCM for transportation of goods from its factory to customer’s premises. No case is made out by the revenue for denial of the CENVAT Credit on the ground that goods were not sold on FOR basis. Inclusion of the cost of transportation in the assessable value of the goods cleared by the Appellant - HELD THAT:- This very issue was considered by the Larger Bench’s in the case of ABB LTD. VERSUS COMMISSIONER OF C. EX. & ST., BANGALORE [2009 (5) TMI 48 - CESTAT, BANGALORE-LB], which was ultimately upheld by the Hon’ble Supreme Court in case of COMMISSIONER OF CENTRAL EXCISE, BELGAUM VERSUS M/S. VASAVADATTA CEMENTS LTD. [2018 (3) TMI 993 - SUPREME COURT], and in which it is held that cenvat credit on outward transportation allowable - Following the decision of the larger bench in ABB Limited, it is held that non-inclusion of the costs of the transportation in assessable value is no ground to deny the CENVAT credit. Time Limitation - HELD THAT:- The demand in the present case relates to the period January, 2005 to June, 2007 and the show cause notice was issued on 02.12.2009. The entire demand is beyond normal period of one year. The issue involved is of interpretation of Cenvat Credit Rules and on this issue there are number of judgements. In these circumstances it cannot be said that the Appellant had a mala fide intention to evade the excise duty by taking the wrong credit - there are no suppression of fact or misstatement on the part of the Appellant. Thus, the extended period cannot apply in the facts of the present case. The impugned order set aside both on merits and on limitation - appeal allowed.
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