2011 (3) TMI 597 - AT - Central Excise

Cenvat credit - whether the appellant is entitled to the benefit of cenvat credit of service tax paid on the clearing agent and forwarding agent services utilised for export purposes - Tribunal in the case of Nirma Ltd. Vs. CCE Bhavnagar (2007 -TMI - 32143 - CESTAT AHEMDABAD), held that CHA services as also the clearing and forwarding agent services are admissible input services, for the purposes of modvat credit - Therefore, set aside the impugned order and allow the appeal with consequential relief to the appellant.

Summary

Issues:
Whether the appellant is entitled to the benefit of cenvat credit of service tax paid on clearing agent and forwarding agent services utilized for export purposes.

Analysis:
The judgment delivered by Hon'ble Mrs. Archana Wadhwa, Member (Judicial), addressed the issue of entitlement to cenvat credit of service tax paid on services utilized for export purposes. The appellant had availed services of clearing agents and forwarding agents for export, and the revenue denied credit, arguing that these services were consumed after the goods were removed from the factory. However, the Tribunal referred to precedent decisions and established that services utilized for export purposes extend the place of removal to the port area. The Tribunal cited cases such as Nirma Ltd. Vs. CCE Bhavnagar and CCE Rajkot Vs. Adani Pharma Chem. Pvt. Ltd., where it was held that CHA services and clearing and forwarding agent services are valid input services for modvat credit.

The Tribunal found that the issue had been settled by previous decisions and ruled in favor of the appellant. The impugned order denying the cenvat credit was set aside, and the appeal was allowed with consequential relief granted to the appellant. The judgment emphasized the admissibility of services utilized for export purposes as valid input services for modvat credit, extending the place of removal to the port area. This decision provides clarity on the eligibility of cenvat credit for services related to export activities, aligning with established precedents and ensuring consistency in tax treatment for similar cases.