2017 (2) TMI 17 - AT - Central Excise

CENVAT credit - input service - whether GTA service availed by the appellant prior to 1.4.2008 to deliver the output to the buyer at his place shall be construed as input service? - Held that - reliance was placed in the case of Commissioner of Central Excise, Chennai II Vs. Lucas TVS Ltd. 2016 (4) TMI 189 - CESTAT CHENNAI , and it was held that the service of GTA availed before 1.4.2008 shall be input service according to the term upto the place of removal used in Rule 2(l) of CENVAT Credit Rules, 2004 - appeal allowed - decided in favor of assessee.

Summary

Issues involved:
Interpretation of whether GTA service availed before 1.4.2008 to deliver output to the buyer's place qualifies as an input service under CENVAT Credit Rules, 2004.

Analysis:
The primary issue in this appeal is the classification of GTA service availed by the appellant before 1.4.2008 as an input service for the purpose of claiming input tax credit. The appellant argues that although the service tax was paid by the recipient of the service, the taxability is not in question, but the eligibility of the service tax element as input credit is disputed.

The appellant relies on the definition of input service under Rule 2(l) of CENVAT Credit Rules, 2004, which includes services used in relation to the clearance of final products up to the place of removal. The appellant cites precedents from various High Courts, such as Karnataka, Gujarat, and Madras, which have held that outward transport of finished goods to the buyer's place falls within the ambit of input service.

Contrarily, the Revenue contends that the lower authorities' orders should be upheld without providing specific reasons. After hearing both parties and examining the records, the Tribunal delves into the evolution of the CENVAT Credit Rules, 2004, highlighting the change in terminology from "from the place of removal" to "upto the place of removal" post 1.4.2008.

Based on the judicial precedents and the interpretation of Rule 2(l) of the CENVAT Credit Rules, 2004, the Tribunal concludes that GTA service availed before 1.4.2008 qualifies as an input service under the definition of "upto the place of removal." Consequently, the appeal is allowed in favor of the appellant. Additionally, a miscellaneous application seeking an extension of the interim stay order is dismissed in light of the appeal's resolution.