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2019 (5) TMI 133 - AT - Central ExciseCENVAT Credit - input services - GTA outward transportation - place of removal - goods sold to the customers on FOR basis - HELD THAT - The Board has clarified in their circular dated 8.6.2018 that when the transaction / sale is on FOR basis, the place of removal would be the buyer s premises. Therefore, it is necessary to determine the place of removal to consider the eligibility of credit of service tax paid on freight charges upto the buyer s premises. It is deemed fit to remand the matter to the adjudicating authority who shall look into the issue of eligibility of credit on GTA service after determining the place of removal - appeal allowed by way of remand.
Issues: Disallowance of credit on GTA service, determination of place of removal for eligibility of credit on freight charges.
Analysis: 1. The case involved the disallowance of credit on GTA service by the authorities due to the appellant availing CENVAT credit on service tax paid on outward transportation. The appellant contended that as goods were sold on FOR basis, the place of removal should be considered as the buyer's premises, making them eligible for the credit. 2. The appellant's counsel referred to a Supreme Court judgment and a circular by the Board to support their argument. They highlighted that Circular F. No. 116/23/2018-CX3 clarified that in cases of sale on FOR basis, the place of removal is the buyer's premises. The appellant requested a remand for reconsideration based on this circular. 3. The respondent supported the findings of the impugned order and emphasized the need for the appellant to provide documents proving the buyer's premises as the place of removal. 4. The Tribunal considered the conflicting judgments of the Supreme Court in Ultra Tech Cement Ltd. and Roofit Industries Ltd. The Tribunal noted that in cases of sale on FOR basis, where the transaction occurs at the buyer's premises, the place of removal is deemed to be the buyer's premises as per the circular issued by the Board. 5. Consequently, the Tribunal set aside the impugned order and allowed the appeal by remanding the matter to the adjudicating authority. The adjudicating authority was directed to determine the place of removal to assess the eligibility of credit on GTA service, considering the circular by the Board and a previous decision of the Tribunal in a similar case. The Tribunal emphasized the importance of correctly determining the place of removal for such cases.
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