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2019 (10) TMI 212 - AT - Central ExciseCENVAT credit - input services - GTA service - place of removal - 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. For this purpose, it is 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 based on the place of removal for eligibility of CENVAT credit.
The judgment pertains to a case where the appellant, engaged in manufacturing wheels and components, availed CENVAT credit of service tax paid on various input services, including outward freight. The adjudicating authority allowed credit for most services but denied it for GTA service. The appellant contended that the place of removal being the buyer's premises, as per a Supreme Court ruling and a circular by the Board, should make them eligible for the credit. The appellant sought a remand for reconsideration based on the circular. The Tribunal considered the issue of disallowance of credit on GTA service. Referring to the Supreme Court rulings in Ultra Tech Cement Ltd. and Roofit Industries Ltd., the Tribunal highlighted that when a sale is on FOR basis and takes place at the buyer's premises, all charges must be included in the assessable value. The Board's circular clarified that in such cases, the place of removal is the buyer's premises. Therefore, determining the place of removal is crucial for considering the eligibility of credit on freight charges. The Tribunal decided to remand the matter to the adjudicating authority to determine the place of removal and consider the eligibility of credit on GTA service in light of the circular and relevant decisions. In conclusion, the Tribunal set aside the impugned order and allowed the appeal by remanding it to the adjudicating authority for further consideration. The adjudicating authority was directed to determine the place of removal and assess the eligibility of credit on GTA service, taking into account the circular issued by the Board and a specific decision of the Tribunal in a related case.
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