2013 (6) TMI 394 - AT - Central Excise

Cenvat Credit - Input Services - GTA - Outward transportation - Held that - . The expression up to the place of removal has a clear and absolute meaning beyond the pale of doubt. In the present case, the final product was cleared from the place of removal (whether it be factory or depot) by the appellant by making use of GTA service. The service so used is not coming within the ambit of the definition of input service for the period after 31.3.2008. - Pre deposit ordered for an amount of Rs. 1 crore and rs. 46.83 lacs.

Summary

Issues:
1. CENVAT credit denial for outward transportation of final product.
2. Interpretation of the definition of 'input service' under Rule 2(1) of the CENVAT Credit Rules, 2004.
3. Requirement of predeposit for waiver and stay of penalties and CENVAT credit.
4. Admissibility of benefit under Notification No.4/2006-CE (Sl. No.1A).

Analysis:

1. CENVAT Credit Denial:
The appeal sought waiver and stay regarding the denial of CENVAT credit of Rs.1,99,31,878/- for outward transportation of cement from the factory to customers' premises. The Tribunal found a prima facie case for the appellant up to 31/03/2008 based on a High Court decision. However, for the period after 01/04/2008, the amended definition of 'input service' under Rule 2(1) was held to operate against the appellant. The Tribunal clarified that CENVAT credit on GTA service for transportation of final products from the place of removal was not admissible post 31/03/2008.

2. Interpretation of 'Input Service' Definition:
The Tribunal emphasized the amended definition of 'input service' post 31/03/2008, which includes services used in or in relation to the manufacture of final products up to the place of removal. It was concluded that the appellant could not claim CENVAT credit on GTA service for outward transportation of cement from the place of removal after 31/03/2008. The Tribunal highlighted the significance of the definition and the clear exclusion of services like GTA post the specified date.

3. Predeposit Requirement for Waiver and Stay:
In response to the circumstances, the Tribunal directed the appellant to predeposit an amount of Rs.1 crore within six weeks for appeal No.E/2908/2012. Compliance was to be reported to the Deputy Registrar by a specified date. Upon due compliance, there would be a waiver and stay concerning penalties imposed and the remaining CENVAT credit amount along with interest.

4. Benefit under Notification No.4/2006-CE (Sl. No.1A):
Regarding appeal No.E/2909/2012, the challenge was against a duty demand and accompanying penalties. The key issue was the admissibility of the benefit under Notification No.4/2006-CE (Sl. No.1A) to the assessee. The Tribunal noted a previous decision in a similar case and found a prima facie merit in favor of the appellant against the demand and penalties, leading to a waiver and stay as requested.

This detailed analysis of the judgment provides insights into the legal interpretation and application of relevant provisions, ensuring a comprehensive understanding of the issues addressed by the Tribunal.