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2014 (4) TMI 510 - AT - Central ExciseCENVAT Credit - GTA Service - whether the respondent is eligible to avail CENVAT credit on service tax paid on outward transportation service during the period from April 2007 to January 2008 - Held that - Commissioner (Appeals) following the decision of the Tribunal in the case of India Cements Ltd. Vs. CCE - 2007 (8) TMI 501 - CESTAT, BANGALORE set aside the adjudication order. The Larger Bench of the Tribunal in the case of ABB Ltd. Vs. CCE - 2009 (5) TMI 48 - CESTAT, BANGALORE held that CENVAT credit is eligible on service tax paid on outdoor transportation service. The Hon ble Karnataka High Court upheld the decision of the Larger Bench of the Tribunal subject to benefit applicable prior to 1.4.2008. Revenue in the grounds of appeal stated that the decision of the Larger Bench of the Tribunal in the case of ABB Ltd. (supra) is still pending before the Hon ble Karnataka High Court. I find that the Hon ble Karnataka High Court has already decided the issue in favour of the respondent. Hence, there is no reason to interfere with the order of the Commissioner (Appeals) - Decided against Revenue.
Issues:
1. Eligibility of the respondent to avail CENVAT credit on service tax paid on outward transportation service from April 2007 to January 2008. Analysis: The Revenue appealed against the Commissioner (Appeals) order where the adjudication order was set aside. The main issue revolved around the eligibility of the respondent to claim CENVAT credit on service tax paid for outward transportation services during a specific period. The Tribunal's decision in the case of India Cements Ltd. was cited, where the CENVAT credit was deemed eligible for service tax on outdoor transportation services. The Larger Bench of the Tribunal in ABB Ltd. case also supported this notion, which was further upheld by the Hon'ble Karnataka High Court. Despite Revenue's argument that the ABB Ltd. case was pending before the High Court, the High Court had already ruled in favor of the respondent. Hence, the Commissioner (Appeals) decision was upheld based on established legal precedents. The Revenue contended that the respondent failed to provide evidence that the sale occurred at the destination point and that freight charges were an integral part of the price. Reference was made to the decision of the Hon'ble Calcutta High Court in the case of CCE Vs. Vesuvious India Ltd., where a temporary stay was granted. However, it was noted that such grounds were not raised by Revenue in the appeal, as the show-cause notice only mentioned the availing of credit for service tax on outward transportation. Consequently, the argument put forth by the Revenue was deemed lacking substance, and it was concluded that there was no merit in their submission. In conclusion, the judgment relied on the decisions of the Hon'ble Karnataka High Court in the ABB Ltd. case and the Hon'ble Gujarat High Court in the Parth Poly Wooven Pvt. Ltd. case to support the rejection of the Revenue's appeal. The order of the Commissioner (Appeals) was upheld, emphasizing the eligibility of the respondent to claim CENVAT credit on service tax paid for outward transportation services during the specified period. The appeal filed by the Revenue was consequently rejected based on the legal precedents and lack of substantial grounds raised by the Revenue during the proceedings.
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