2013 (4) TMI 472 - AT - Central Excise

Denial of credit of service tax on Foreign Commission Agents Services utilized in respect of tractors exported - tractors were exported under bond Held that - following the case of Jobelle Vs. CCE, Mumbai-I 2006 (8) TMI 34 CESTAT , in the absence of any contrary decision by any higher judicial forum, we set aside the impugned order and allow the appeal.

Summary

Issues: Denial of credit of service tax paid on 'Foreign Commission Agents Services' utilized in respect of exported tractors.

The judgment revolves around the denial of credit of service tax paid on 'Foreign Commission Agents Services' utilized in the export of tractors. The appellant argued that the tractors were exported under bond. Reference was made to a previous Tribunal case, Jobelle Vs. CCE, Mumbai-I, where it was held that Cenvat credit on inputs is not allowed if used in the manufacture of exempted goods, except when goods are cleared for export under bond without payment of duty. The Tribunal in the cited case interpreted the provisions liberally and allowed the appeal, emphasizing the rationale behind refund of input duty credit on exported goods to maintain competitiveness in the international market. The judgment noted the similarity between Rule 6 (5) of CCR, 2002, and Rule 6 (6) of CCR, 2004, applicable in the present case, and in the absence of any contrary decision by a higher judicial forum, set aside the impugned order and allowed the appeal, disposing of the stay petition as well.