2013 (6) TMI 642 - AT - Service Tax

Cenvat Credit - Input services - place of removal - GTA Service - Outward transportation - activity relating to manufacturing - Held that - first appellate authority was following the law as has been decided by the various decisions of this bench and more specifically Rolex Mills Pvt. Ltd. 2008 (2) TMI 770 - CESTAT AHMEDABAD and Adani Pharmachem Pvt. Ltd. 2008 (7) TMI 102 - CESTAT AHMEDABAD - in respect of export goods the place of removal is the port of loading. Therefore all the services upto the port of export are input services and service tax paid on such input services is eligible for cenvat credit. - Decided in favor of assessee.

Summary

Issues:
- Eligibility of cenvat credit for service tax paid on GTA outward services for export.

Analysis:
The appeal in this case revolves around the eligibility of the respondent to claim cenvat credit for service tax paid on GTA outward services utilized for the export of goods. The Department contended that the respondent was not entitled to such credit as the services were not directly or indirectly used in or in relation to the manufacture of final products. A show cause notice was issued, leading to the confirmation of a demand along with interest and penalty by the impugned order. The respondent, aggrieved by this decision, appealed to the first appellate authority, which set aside the original order and allowed the appeal. The Revenue then brought the matter before the Tribunal.

The crux of the issue lies in whether the appellant can avail cenvat credit for service tax paid on GTA outward services used for goods meant for export. The first appellate authority, in its decision, referred to Circular No.97/8/2007-ST and various tribunal judgments, including Adani Pharma Chem Pvt. Ltd. and Rolex Rings Pvt. Ltd., to support the eligibility of cenvat credit in such cases. The authority held that for export goods, the 'place of removal' is considered to be the port of loading, making all services up to the port of export eligible for cenvat credit. This interpretation was in line with previous decisions by the Tribunal and coordinated benches.

Upon reviewing the submissions and records, the Tribunal found that the first appellate authority's decision was consistent with established legal principles and precedents set by previous judgments. The Tribunal noted that the appellant's eligibility for cenvat credit was supported by the decisions in cases like Rolex Mills Pvt. Ltd. and Adani Pharmachem Pvt. Ltd. The Tribunal, therefore, upheld the first appellate authority's order, concluding that it was legally sound and in line with the favorable precedents. As a result, the Tribunal rejected the appeal, affirming the correctness and legality of the impugned order.