2018 (11) TMI 25 - AT - Service Tax

100% EOU - Refund of accumulated CENVAT Credit - denial on the ground that GTA service on account of nexus - denial also on the ground that credit was availed after 5 years, which is not proper - Held that - In view of the Board Circular dated 28.2.2015 and in view of the decision of the Tribunal in the case of Kennametal India Ltd. 2016 (8) TMI 1031 - CESTAT BANGALORE , it is a settled issue that in the case of export, port is the place of removal and credit up to the port of export is an input credit, which the appellant is entitled to. Further, there is no time limit prescribed under CENVAT credit scheme for availing the CENVAT credit and it has been so held in the case of Coromandel Fertilizers Ltd. 2008 (8) TMI 333 - CESTAT, BANGALORE . Appeal allowed - decided in favor of appellant.

Summary

Issues:
Appeal against denial of irregular CENVAT credit availed by the appellant.

Analysis:
The appellant, a 100% Export Oriented Unit, filed a refund claim of accumulated CENVAT Credit, out of which a portion was related to Goods Transport Agency (GTA) Services. The Revenue issued a show-cause notice proposing to deny credit, resulting in a partial disallowance. The matter was remanded by CESTAT for fresh decision, leading to the confirmation of the disallowance. The denial was based on the nature of input services and the timing of credit availed. The appellant argued that the impugned order was contrary to binding Circulars and judicial precedents, asserting their entitlement to the credit. They cited relevant Circulars and legal decisions to support their claim. The appellant contended that there is no time limit for availing CENVAT credit, citing legal precedents in their favor.

Regarding the denial of credit on GTA services, the appellant argued that in the case of export, the port is considered the place of removal, making the credit up to the port of export eligible. They emphasized that there is no prescribed time limit for availing CENVAT credit, as supported by legal precedents. The AR defended the impugned order, but the Tribunal found in favor of the appellant. The Tribunal held that the denial of credit on GTA services was not sustainable in law, citing the Board Circular and previous legal decisions. They emphasized that the appellant was entitled to the credit up to the port of export and that there is no time limit for availing CENVAT credit. Consequently, the impugned order was set aside, allowing the appeal of the appellant with any consequential relief.

In conclusion, the Tribunal's decision favored the appellant, setting aside the denial of irregular CENVAT credit on GTA services. The judgment highlighted the entitlement of the appellant to the credit up to the port of export and emphasized the absence of a time limit for availing CENVAT credit, in line with relevant Circulars and legal precedents.