2021 (4) TMI 1289 - AT - Central Excise

Refund of accumulated Cenvat Credit in cash - ineligible input services - clearing and forwarding agent services - period October, 2008 and December, 2008 - HELD THAT - The precedents on the subject held that credit of service tax paid on clearing and forwarding agent services are admissible. The Cenvat credit availed on clearing and forwarding agent s service is admissible to the Appellant and consequently the refund of accumulated credit Cenvat credit on this service on export of the finished goods is also admissible to the Appellant - Appeal allowed - decided in favor of appellant.

Summary

Issues:
Entitlement to cash refund of accumulated Cenvat Credit in relation to clearing and forwarding agent services for the period October, 2008 and December, 2008.

Analysis:
The appeals were filed against Order-in-Appeals No. CD/220 & 221 /BEL/2015 dated 27.01.2015 passed by Commissioner of Central Excise(Appeals), Mumbai. The appellants, engaged in the manufacture of chemicals and bulk drugs, had availed Cenvat Credit on various input services during October 2008 and December 2008. The cash refund claim filed under Rule 5 of the Cenvat Credit Rules, 2004 on export of the finished goods was deemed inadmissible due to certain input services, specifically clearing and forwarding agent services. The Commissioner (Appeals) upheld the denial of credit on these services, leading to the present appeals before the Tribunal.

The learned Advocate for the Appellant argued that they had availed Cenvat credit on various input services, including clearing and forwarding agent services, for goods that were exported. They contended that a previous Tribunal order allowed cash refund of Cenvat credit on similar services, and hence, they should be entitled to the credit in the present case as well. On the other hand, the Revenue's representative supported the findings of the Commissioner (Appeals).

After hearing both sides and examining the records, the Tribunal analyzed whether the Appellants were entitled to a cash refund of accumulated Cenvat Credit related to clearing and forwarding agent services for the specified periods. The Tribunal referred to a precedent in their own case where it was established that credit of service tax paid on clearing and forwarding agent services is admissible. The Tribunal highlighted that services received by an assessee at the port for export of goods are eligible for Cenvat credit under the Cenvat Credit Rules, 2004. Therefore, following this precedent, the Tribunal held that the Cenvat credit availed on clearing and forwarding agent's service is admissible to the Appellant, and consequently, the refund of accumulated credit on this service for the export of finished goods is also admissible. As a result, the impugned order was set aside, and the appeals were allowed with any consequential relief as per law.