2013 (12) TMI 1640 - AT - Service Tax

CENVAT credit - various input services - Place of removal - Held that - the credit taken up to the stage where goods have reached from the place of removal would be admissible if the same can be related to business of manufacture - in respect of exports place of removal would be port. Even though the definition was amended on 1-4-2008 and words from the place of removal in the definition and definition of input services were replaced by up to the place of removal , once we take a view that the port has to be treated as place of removal in respect of exports, the services utilized by the appellant would be covered even after the amendment of the definition. Moreover by the very words used for in respect of different services would show that they have nexus to the goods manufactured and exported and therefore it cannot be said that they have nothing to do with the business of manufacture. Appeal allowed - decided in favor of appellant.

Summary

Issues Involved:
Whether the appellant is eligible for Cenvat credit of Service Tax paid on various services used by them for manufacturing goods exported between November 2004 to December 2008.

Analysis:
The issue in this case revolves around the eligibility of the appellant for Cenvat credit of Service Tax paid on multiple services utilized by them for manufacturing goods that were subsequently exported. The appellant claimed that the services were utilized in the business of manufacture and thus, credit was admissible. The key contention was determining the "place of removal" in the case of exports, as the definition of input services was crucial in deciding the admissibility of the credit. The judgment highlighted that exports are based on Free on Board (FOB) terms, making the port the place of removal for exports. It was emphasized that services received before the export of goods and storage up to the place of removal would be covered under the definition. The amendment in the definition from "from the place of removal" to "up to the place of removal" did not affect the eligibility of the services utilized by the appellant, given the nexus of these services to the manufactured and exported goods. The judgment concluded that the services had a direct connection to the business of manufacture and export, leading to the setting aside of the impugned order and allowing the appeal with consequential relief if any.

This detailed analysis of the judgment showcases the meticulous consideration of the legal provisions, definitions, and factual circumstances surrounding the eligibility of Cenvat credit for the appellant. The interpretation of the term "place of removal" in the context of exports played a pivotal role in determining the admissibility of the credit for the services utilized by the appellant. The judgment's thorough examination of the services in question and their relevance to the business of manufacture and export underscored the justification for allowing the appeal and providing consequential relief. Overall, the judgment provides a comprehensive and legally sound reasoning for the decision reached, ensuring clarity on the applicability of Cenvat credit in similar cases involving exported goods and related services.