TMI Blog2011 (5) TMI 142X X X X Extracts X X X X X X X X Extracts X X X X ..... y to place of port treating that services as input services. 2. Heard both sides extensively. Further, as permitted after the hearing was over, both sides have filed written submissions. 3. The relevant facts, in brief, are that the respondent is a manufacturer of zinc, lead, and other concentrates. Original authority denied credit on service tax paid on outward transport of the goods from the factory to Kandla port holding that the GTA services utilised cannot be treated as input services in relation to manufacture and removal of final products by the respondent company. (The order of the original authority related to dispute on Cenvat on other services which are not relevant to the present proceedings.) Commissioner (Appeals), however, held that the GTA services used in the above circumstances has to be treated as input services and allowed the cenvat credit. Hence, the department is in appeal. 4. Learned DR, reiterating the grounds of appeal, submits that Board's circular No. 97/8/2007-ST dated 23-8-2007 covers clearance of goods within the country where goods are delivered by the assessee on the door step of the consignee. He submits that port of export cannot be treated ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 15-1-2010]; 4. Cauvery Stones Impex (P.) Ltd. v. CCE 2010 (257) ELT 151/24 STT 400 (Chennai - CESTAT); 5. CCE v. Fourrts (I) Laboratories (P.) Ltd. [Final Order No. 1402/2009, dated 8-10-2009]; 6. CCE v. Fine Care Biosystems [Final Order No. A/1337/2009-WZB/Ahd., dated 3-7-2009]; 7. CCE v. Colour Synth Indus. (P.) Ltd. [Final Order No. A/245/2009-WZB/Ahd., dated 15-1-2009]; 8. CCE v. Adani Pharmachem (P.) Ltd. [2009] 19 STT 239 (Ahd. - CESTAT) 6.1 I have carefully considered the submissions from both sides and perused the records. The respondents is exporting their final products namely, the concentrates. The final products during the course of journey before reaching the foreign buyers, goes through the local transporters and gets unloaded at the port area and gets loaded into the ship and thereafter gets cleared from the port of destination and further gets transported to the place of the buyer. There could be contract between the buyer and seller for delivery at any place like their factory gate of the respondent, port area in India, port area in the foreign country or even the premises of the buyer abroad based on terms of the contract. When the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t destroyed after clearance, the question of seeking remission of duty involved does not arise as liability to duty is not dependent on any event after clearance from the place of removal which is the factory in such a situation. 6.5 The Central Excise valuation Law is common for goods cleared for export and goods cleared for domestic consumption. In either case the transport charges incurred for transport of the goods from the place of removal is to be excluded. 6.6 The ownership of the goods is not the relevant criteria for determining the liability to duty which is at the time and place of removal and therefore, may not be relevant to determine whether certain services can be treated as input services or not. If certain goods are exported for exhibition abroad and brought back it would imply that the entire expenses incurred for taking out of the country and bringing back will be treated as part of input services as the ownership has not changed. 6.7 The claim that the concentrate yard in the port area is the place of removal and from the said point sales takes place is contrary to the facts and legal positions involved in sales activity. The commercial invoices are also i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e registry, and security, (vii) inward transportation of inputs or capital goods and (viii)outward transportation upto place of removal." 8.3 It is appropriate to closely analyse the inclusive part of the definition of input services. The activities like "advertisement or sales promotion", "market research" "procurement of inputs" and "inward transportation of inputs or capital goods" are also business activities, as understood in common parlance. Therefore, the term "activities relating to business" deserves to carefully understood and appreciated. In the inclusive part of the definition activities relating to business have been illustrated. The scope of activities relating to business should be understood by the specific activity mentioned after use of the phrase 'such as'. In the light of the above, there is no scope to treat the term 'outward transportation up to place of removal' as having been included under inclusive definition of "activities relating to business". 9. From the above, the following emerges : "(a) removal of the final product takes place in this case at the factory gate and the liability to duty arises at the time and place of removal; (b) Ther ..... X X X X Extracts X X X X X X X X Extracts X X X X
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