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TMI BlogCan Avail Service Tax Input Credit of Product Liability InsuranceX X X X Extracts X X X X X X X X Extracts X X X X ..... Can Avail Service Tax Input Credit of Product Liability Insurance X X X X Extracts X X X X X X X X Extracts X X X X ..... ay all losses to buyer. Reply By Rajagopalan Ranganathan: The Reply: Sir, If the insurance service is provided in India before despatch of the goods for export and the Insurance Company is also located in India you are eligible to avail the credit of service tax paid on such service. Reply By Uttam Javia: The Reply: Dear Sir, Thanks for replay… Regarding your replay further inform t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hat: * It is a continuing export goods (regular supply) and insurance policy for one year and before expiring it's renewed for next year (it min policy covered before supply of goods) * The Insurance company located in India and provide service in India but effective area not in India In connection with my query further inform you that this query raised by audit party and issue show cause ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... with below points: * The Insurance Premium of Product Recall Liability/Product Liability Policies for any eventuality that may arise post-export and hence, in any case, after the goods had left the place of removal or in other words i.e. beyond the place of removal as defined under Rule 2(L) (ii) of Cenvat Credit Rule 2004 read with Explanation VI(II) (c) to Section 4 of the Central Excise Ac ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t, 1944. * Whereas, it appears that the Cenvat Credit availed on the services i.e. insurance premium of policies viz. Product Recall Liability / Product Liability policies issued by the insurance company in relation to goods exported, is the services availed on goods after its removal from place of removal as defined under Rule 2(L) (ii) of Cenvat Credit Rules 2004 read with Explanation VI(II) ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... (c) to Section 4 of the Central Excise Act, 1944. and accordingly, the notice is not entitled to take credit under Rule 3 of the Cenvat Credit Rules, 2004. * Is it any court judgment available for this type of query? Reply By PAWAN KUMAR: The Reply: Dear Sir, As per my view, you can take cenvat credit of insurance policy taken for your final products. Reply By Rajagopalan Ranganathan: The ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Reply: Sir, As per para 5 & 6 of CBEC's Circular No. 999/6/2015-CX dated 28th February, 2015 clearance of goods for exports from a factory can be of two types. The goods may be exported by the manufacturer directly to his foreign buyer or the goods may be cleared from the factory for export by a merchant exporter. 6. In the case of clearance of goods for export by manufacturer exporter, sh ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ipping bill is filed by the manufacturer exporter and goods are handed over to the shipping line. After Let Export Order is issued, it is the responsibility of the shipping line to ship the goods to the foreign buyer with the exporter having no control over the goods. In such a situation, transfer of property can be said to have taken place at the port where the shipping bill is filed by the manuf ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... acturer exporter and place of removal would be this Port/ICD/CFS. Needless to say, eligibility to CENVAT Credit shall be determined accordingly. In view of the above clarification place of removal for export goods is the port/ICD/CFS. I hope you are insuring the goods before it is handed over to shipping liner at the port. Any service availed up to the place of removal is eligible for input servi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ce credit. Therefore you are eligible to take the credit. X X X X Extracts X X X X X X X X Extracts X X X X
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