2019 (8) TMI 487 - AT - Central Excise

CENVAT Credit - input services - GTA Services up to the place of removal i.e., the customer s place - - C.B.I.C. Circular No. 1065/4/2018-CX in F. No 116/23/2018-CX-3 dated 08.06.2018 - HELD THAT - It is undisputed that the decision of the Hon ble Apex Court in the case of COMMISSIONER OF CENTRAL EXCISE SERVICE TAX VERSUS ULTRA TECH CEMENT LTD. 2018 (2) TMI 117 - SUPREME COURT covers even the post-amendment period, which is binding on all lower authorities. However, as the issue in the case on hand involves delivery on FOR destination basis, which is the trump card of the assessee s pleading and which clearly has not at all been discussed by the Adjudicating Authority or even by the First Appellate Authority, the matter is required to be remitted to the file of the First Appellate Authority for the very limited purpose of considering the explanations of the appellant filed in response to the Show Cause Notice and in the light of subsequent Board Circular No. 1065/4/2018-CX. Appeal allowed by way of remand.

Summary

Issues:
Denial of CENVAT Credit on GTA Services up to the place of removal - determination of place of removal for CENVAT Credit eligibility.

Analysis:
The appellant contended that the denial of CENVAT Credit on GTA Services was the only issue, emphasizing the sale on 'FOR' destination basis at the customer's place. Reference was made to the CBIC Circular clarifying that decisions in specific cases do not address the 'FOR' destination basis, necessitating case-specific determinations. Despite providing documentary evidence supporting the 'FOR' destination sale, both authorities failed to consider it.

The Revenue argued the lack of evidence regarding 'FOR' destination basis sale, suggesting a remand for consideration if such evidence exists. Referring to judicial precedents, including the Rajasthan High Court's decision, it was asserted that the place of removal post-amendment is limited to the factory gate, not beyond. The Bangalore CESTAT order and the Supreme Court's ruling on valuation concerning the place of removal were also cited.

The appellant countered by highlighting the Board Circular's requirement to assess the place of removal based on case facts. Distinguishing the case from Ultra Tech Cement Ltd., it was argued that the final product's nature affects the duty liability. The High Court's decision on Mangalam Cement Ltd. was challenged for not considering the Board Circular or the 'FOR' destination basis issue.

After reviewing submissions and documents, the Tribunal noted the appellant's explanation of 'FOR' destination basis sale and ownership until delivery at the purchaser's door. Previous decisions prompted remittance to determine CENVAT Credit eligibility based on Supreme Court cases and the CBIC Circular.

The Tribunal observed that the High Court's ruling did not address the 'FOR' destination basis issue, necessitating a remand for further consideration. Given the absence of discussion on 'FOR' destination basis by lower authorities, the matter was remanded to the First Appellate Authority for a comprehensive review incorporating relevant legal precedents and Circulars.

Conclusively, the impugned order was set aside, and the appeal was partially allowed for remand to assess CENVAT Credit eligibility on GTA Services based on the 'FOR' destination basis and pertinent legal references.