2015 (3) TMI 1063 - AT - Service Tax

Denial of CENVAT Credit - credit on the same as transportation has been done beyond the place of removal - Held that - case the transportation cost has been added in the assessable value of the impugned goods and goods have been sold on FOR basis. Therefore, the appellant is entitled to take Cenvat credit in the light of C.B.E. & C. Circular No. 97/8/2007, dated 23-8-2007. In these circumstances, I hold that appellant is entitled to take Cenvat credit. Consequently, impugned order is set aside. - Decided in favour of assessee.

Summary

Issues: Denial of input service credit on outward transportation service due to transportation beyond the place of removal during October 2007 to March 2008.

Analysis:
1. The appellant contended that Cenvat credit on outward transportation service should be allowed based on the decision of the Hon'ble High Court of Karnataka in the case of ABB Ltd. The appellant argued that since goods were sold on a FOR basis and transportation cost was included in the assessable value of the goods, Cenvat credit should be available.

2. The learned AR, on the other hand, relied on the decision of the Hon'ble High Court of Calcutta in the case of CCE, Kolkata v. Vesuvious India Ltd. The AR pointed out the existence of two contradictory decisions from different High Courts and emphasized that neither court had jurisdiction over the current case. The judge decided to take an independent view and found that in the present case, the transportation cost had indeed been added to the assessable value of the goods sold on a FOR basis. Referring to Circular No. 97/8/2007, dated 23-8-2007, the judge concluded that the appellant was eligible to claim Cenvat credit. Consequently, the impugned order was set aside, and the appeal was allowed with any consequential relief.

This judgment highlights the importance of considering specific circumstances and relevant legal provisions when determining the eligibility of Cenvat credit, especially in cases where there are conflicting decisions from different High Courts. The judge's independent analysis and reliance on relevant circulars demonstrate a thorough and reasoned approach to resolving the issue at hand.