2018 (12) TMI 847 – CESTAT KOLKATA – TMI – CENVAT Credit – input services – services received by them from the various transporters towards outward transportation of excisable goods from the appellant’s factory to the buyer’s premises (carriage outwards) – period 2006-2007 and 2007-2008 – Held that:- The present issue is no more res-integra and is decided in favour of the appellant in view of the decision of the Hon’ble Supreme Court in the case of Commr. of Customs, Central Excise & S.Tax, Guntur Vs. Andhra Sugars Ltd. [2018 (2) TMI 285 – SUPREME COURT OF INDIA], where it was held that Once it is accepted that place of removal is the factory premises of the assessee, outward transportation ‘from the said place’ would clearly amount to input service.
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Credit allowed – appeal allowed – decided in favor of appellant.
– Ex. Appeal No.76045/18 – FO/76576/2018 – Dated:- 21-5-2018 – SHRI P. K. CHOUDHARY, JUDICIAL MEMBER Shri S.P. Siddhanta, Consultant for the Appellant (s) Shri S. S
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the relevant Paragraphs are reproduced below: 6. As mentioned above, in these cases, the assessees are claiming Cenvat credit in respect of service tax paid on outward transportation from their factory to the premises of customers. As per the Department, outward transportation engaged for removal of goods from factory to customer premises cannot be considered as an input service since premises of customer is not recognized as a place of removal under the Central Excise Act. To put it differently, the Department contends that the outward transportation provided beyond the place of removal is not eligible for input service for availing Cenvat credit. 7. Having regard to the definition of input service that was prevailing at the relevant time i.e. prior to April 1, 2008, the aforesaid contention of the Department cannot be accepted. As per the said definition, service used by the manufacturer of clearance of final products from the place of removal to the warehouse or customer s place etc
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val are to be treated as input service. The first clause does not mention transport service in particular. The second clause restricts transport service credit upto the place of removal. When these two clauses are read together, it becomes clear that transport service credit cannot go beyond transport upto the place of removal. The two clauses, the one dealing with general provision and other dealing with a specific item, are not to be read disjunctively so as to bring about conflict to defeat the laws scheme. The purpose of interpretation is to find harmony and reconciliation among the various provisions . Similarly, in the case of M/s. Ultratech Cements Ltd. v. CCE, Bhavnagar – 2007-TIOL-429-CESTAT-AHM, 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 lega
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herein the excisable goods have been permitted to be stored without payment of duty; (iii) a depot, premises of a consignment agent or any other place or premises from where the excisable goods are to be sold after their clearance from the factory; from where such goods are removed. It is, therefore, clear that for a manufacturer/consignor, the eligibility to avail credit of the service tax paid on the transportation during removal of excisable goods would depend upon the place of removal as per the definition. In case of a factory gate sale, sale from a non-duty paid warehouse, or from a duty paid 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
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, dealt with unamended Rule 2(l) of Rules, 2004. The three conditions which were mentioned explaining the place of removal are defined in Section 4 of the Act. It is not the case of the Department that the three conditions laid down in the said Circular are not satisfied. If we accept the contention of the Department, it would nullify the effect of the word from the place of removal appearing in the aforesaid definition. Once it is accepted that place of removal is the factory premises of the assessee, outward transportation from the said place would clearly amount to input service. 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. 5. Respectfully following the ratio of the above judgement of the Hon ble Supreme Court in the case of Andhra Sugars Ltd. (supra),
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