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availment of service tax credit for GTA out ward services

Service Tax - Started By: - ramswaroop vyas - Dated:- 2-2-2016 Last Replied Date:- 8-3-2016 - Dear Experts, My queries relates to take credit of the service tax paid on out ward freight. below is brief of my sales patterns1. We are a manufacturing unit,2. We pay the freight on outward transportation ( dispatches made) and our delivery terms are door delivery therefore place of removal is customer gate.3. We are showing Freight separately in invoices ...invoice pattern is as below.Sale value for .....

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tained in term of provisions of Central Excise Act, 1944 read with provisions of the Sale of Goods Act, 1930. Payment of transport , inclusion of transport charges in value , payment of insurance or who bears the risk are not the relevant considerations to ascertain the place of removal , the place where sale has taken place or when the property in goods passes from the seller to the buyer is the relevant consideration to determine the place of removal . - Reply By Rajagopalan Ranganathan - The .....

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ons:- the post sale transport of manufactured goods is not an input for the manufacturer/consignor. The two clauses in the definition of 'input services' take care to circumscribe input credit by stating that service used in relation to the clearance from the place of removal and service used for outward transportation upto the place of removal are to be treated as input service. The first clause does not mention transport service in particular. The second clause restricts transport serv .....

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Ultratech Cements Ltd vs CCE Bhavnagar 2007 (3) TMI 738 - CESTAT AHMEDABAD, it was held that after the final products are cleared from the place of removal, there will be no scope of subsequent use of service to be treated as input. The above observations and views explain the scope of the relevant provisions clearly, correctly and in accordance with the legal provisions. In conclusion, a manufacturer / consignor can take credit on the service tax paid on outward transport of goods up to the pl .....

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ct, 1994, they shall have the same meaning for the CENVAT Credit Rules as assigned to them in those Acts. The phrase 'place of removal' is defined under section 4 of the Central Excise Act, 1944. It states that,- place of removal means- (i) a factory or any other place or premises of production or manufacture of the excisable goods ; (ii) a warehouse or any other place or premises wherein the excisable goods have been permitted to be stored without payment of duty ; (iii) a depot, premis .....

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depot (from where the excisable goods are sold, after their clearance from the factory), the determination of the 'place of removal' does not pose much problem. However, there may be situations where the manufacturer /consignor may claim that the sale has taken place at the destination point because in terms of the sale contract /agreement (i) the ownership of goods and the property in the goods remained with the seller of the goods till the delivery of the goods in acceptable condition .....

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ise Act, 1944 as also in terms of the provisions under the Sale of Goods Act, 1930) occurred at the said place. This circular is still in force and is binding on the Department and assessees - Reply By KASTURI SETHI - The Reply = Sh. Ramswaroop Vyas Ji, In a nutshell, since in this case the place of removal is at the buyer's doorstep, you can take input service credit of ST paid on outward freight. You must have documentary evidence to the effect that ownership of the goods remained with you .....

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mbers here, In the case of LAFARGE INDIA LTD. Vs.COMMISSIONER OF CENTRAL EXCISE, RAIPUR 2014 (307) E.L.T. 7 (Chhattisgarh) = 2014 (10) TMI 297 - CHHATTISGARH HIGH COURT on the similar footing it was ordered that the conclusion is irrestible that sales by the assessee were on FOR basis and therefore, the assessee had legitimately availed Cenvat credit on the Service Tax paid on the freight charges borne for its FOR sales. It was further held that where the terms bet .....

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sessee that FOR delivery of goods shall be meant to place of delivery at the buyers place and GTA service used till shall be admissible for credit as input service included in the cost upto place of removal being place of destination in this case. - Reply By Ganeshan Kalyani - The Reply = The query is nicely explained and have covered all the aspects without being by the querist the case laws and explanation has been provided. Thanks to all the experts for sharing your valuable knowledge. I have .....

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rts,Thanks for the reply in a Lucid manner.Here I am of the View that Central Excise Department will take a stand that The Assessable value will be ₹ 100/- (in place of ₹ 98) and Excise duty @ 12.5% i.e. ₹ 12.50 should be paid as against ₹ 12.25 as shown in the query.Pl. Highlight Your expert Opinion.For Your ready reference the query raised is also appended below.We are showing Freight separately in invoices ...invoice pattern is as below.Sale value for say 100 Rs.inovic .....

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ce of removal (i.e. whether place of removal is factory OR it is the destination of the buyer). Issue in the above case is: Ispat clears the goods from factory on payment of duty treating the place of removal as factory and deliver the goods to the premises of customer. No duty is paid on the freight and insurance amount and claimed the same as abatement from the total price. Department wanted to demand duty even on the freight value on the ground that (a) Ispat has taken an insurance policy to .....

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considered as place of removal in terms of Section 4 read with other valuation rules, place of removal is factory only and freight is not includible in assessable value and hence, department appeal is dismissed. Since SC has specifically stated that at any point customer premises cannot be considered as place of Removal , the issue of input service tax credit on outward freight may arise, particularly on the eligibility of cenvat credit on outward freight Further, consequent to inclusion of defi .....

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S. Gokarnesan Advocate, Chennai - Reply By ramswaroop vyas - The Reply = Respected All, Thanks for all your wonderful replies i would have not got such details even after paying...but my query still remains open....As nobody has covered that if i am showing freight separately and not paying excise on the same........so can you please expert throw light in this...can i still take service tax credit as i am charging freight separately in invoice.regardsramswaroop - Reply By Mahir S - T .....

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Supreme Court Decision on the interpretation of place of removal, you are not eligible for the service tax credit.This is applicable even if you pay excise duty on freight.As a consolation , you may claim abatement of freight value including service tax to arrive at the Transaction Value for excise duty computation since excise valuation rules allow abatement on the cost of transportation. Here service tax also along with freight to be considered as cost of transportation in as much as no credit .....

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₹ 25/- Gokarnesan Advocate9840087349 - Reply By KASTURI SETHI - The Reply = SH.GOKARNESAN.S SUBRAMANIAN Ji, Thanks a lot for posting latest judgement of the Apex Court. The issue is worth discussion and decision by the Larger Bench of the Honourable Supreme Court. - Reply By KASTURI SETHI - The Reply = In my view Sale of Goods Act has overlapped Central Excise Act and Central Excise Rules. - Reply By KASTURI SETHI - The Reply = Just for information on this issue Three judgments have been p .....

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place of removal - Reg. - Reply By KASTURI SETHI - The Reply = Sale of Goods Act, 1930 has not taken birth in the year 2015. Suddenly the wisdom has dawned and Board has taken u-turn by issuance of Circular No. 999/6/2015-CX, dated 28-2-2015. The department has been raising and confirming the demands on the ground that the place of removal is buyer's premises inasmuch as the amount of freight and transit insurance were borne by the manufacturer from factory to the depot or buyer's premi .....

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