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2012 (9) TMI 382 - AT - Central ExciseDenial of CENVAT Credit on outward transportation - CENVAT Credit availed on GTA Service up to the place of removal - Held that - As decided in CCE & ST, LTU, Bangalore vs. ABB Ltd. 2011 (3) TMI 248 - KARNATAKA HIGH COURT by notification No.10/2008-C.E.(N.T.) dated 1.3.2008 the words clearance of final products upto the place of removal were substituted in the place of the words clearance of final products from the place of removal . Till such amendment, the words clearance from the place of removal included transportation charges from the place of removal till it reached the destination, namely the customer and Credit of service tax paid on outward transportation allowed prior to 1.4.2008 - as the period involved in this case is from April, 2005 to March, 2006 decided in favour of assessee.
Issues:
Appeal against Order-in-Appeal allowing respondent's appeal on CENVAT Credit for outward transportation beyond place of removal. Interpretation of CENVAT Credit rules till 01.04.2008 based on Karnataka High Court's decision in ABB Ltd. case. Analysis: The Revenue filed an application to stay the operation of the Order-in-Appeal where the Commissioner (Appeals) allowed the respondent's appeal related to CENVAT Credit on outward transportation. The respondent, engaged in manufacturing excisable goods, availed CENVAT Credit on Service Tax paid on outward transportation beyond the place of removal. The Department denied the credit, leading to proceedings and a penalty imposed by the Lower Adjudicating Authority. The Commissioner (Appeals) set aside the order, prompting the Revenue's appeal. The main issue revolved around the period from April 2005 to March 2006 and the CENVAT Credit availed on GTA Service up to the place of removal. The respondent cited the decision of the Karnataka High Court in the ABB Ltd. case as precedent for their case. The Revenue argued that an SLP was filed against the Karnataka High Court's decision, but the respondent highlighted that the SLP was not admitted by the Supreme Court and there was no stay. After hearing both sides, the Tribunal found that the appeal could be disposed of at that stage. Considering the settled issue by the Karnataka High Court in the ABB Ltd. case regarding CENVAT Credit on outward freight until 01.04.2008, the Tribunal noted that there was no stay against this interpretation. The Tribunal referred to the High Court's decision, which favored the assessee and held that there was no merit in the Revenue's appeal. Consequently, the appeal was dismissed, and the stay petition was also disposed of.
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