2012 (9) TMI 869 - AT - Central Excise

Denial of CENVAT credit - Goods Transport Agency Service - Intrepretation of input service - Held that - outward transportation of goods from the factory (place of removal) was very much within the scope of the definition of input service given under Rule 2(l) as this rule stood prior to 01/04/2008. The period of dispute in the present case is also prior to 01/04/2008 - Following decision of Commissioner vs. ABB Ltd. 2011 (3) TMI 248 - KARNATAKA HIGH COURT - Decided in favour of assessee.

Summary

Issues:
Denial of CENVAT credit on Goods Transport Agency Service (GTA service) used for outward transportation of final products.

Analysis:
The appeal pertains to the denial of CENVAT credit on GTA service used for transporting final products from the factory to customers' premises during a specific period. The appellant contested the demand by referring to the definition of input service and place of removal, as well as relying on a CBEC Circular and decisions of the Tribunal. The learned Superintendent (AR) mentioned a similar issue considered by the High Court of Karnataka in a previous case, Commissioner vs. ABB Ltd., where the High Court ruled in favor of the assessee for a period before April 2008. The High Court held that outward transportation of goods from the factory falls within the definition of input service as per Rule 2(l) before 01/04/2008. Since the period in question in the present case is also before 01/04/2008, the High Court's ruling is deemed applicable, leading to the allowance of the appeal.

This judgment highlights the importance of understanding the definitions and interpretations of key terms such as input service and place of removal in the context of claiming CENVAT credit. It also underscores the relevance of judicial precedents and rulings in similar cases to support arguments and decisions in legal matters. The reference to the High Court's judgment and its application to the current case demonstrates the significance of legal consistency and adherence to established principles in resolving disputes related to taxation and credit claims. The decision to allow the appeal based on the High Court's ruling showcases the impact of legal interpretations and authorities on the outcome of such cases, emphasizing the need for thorough analysis and consideration of relevant legal provisions and precedents in similar disputes.