2015 (1) TMI 1193 - AT - Service Tax

Denial of input service credit - Availment of service beyond place of removal - Held that - CHA services have been availed by the appellant in the course of export of goods and in the case of the export goods, the place of removal is the port from where the goods have been exported. Therefore, we hold that the CHA service has been availed by the appellant till the place of removal. Further, we find that in the case of Commissioner of C. Ex., Nagpur v. Ultratech Cement Ltd., reported in 2010 (10) TMI 13 - BOMBAY HIGH COURT wherein the Hon ble High Court of Bombay has held that being a manufacturer of excisable goods if the assessee availed any services, the assessee is entitled to take input service credit in the course of their business activity. As it is not in dispute that appellant being a manufacturer has availed all the services in the course of their business. Therefore, we hold that appellants are entitled for input service credit on all the services discussed hereinabove. Accordingly, the impugned order is set aside - Decided in favour of assessee.

Summary

Issues:
- Denial of input service credit on various services under Cenvat Credit Rules, 2004.

Analysis:
The appellant appealed against the denial of input service credit on services like clearing charges, commission on export sale, material handling charges, terminal handling charges, bank commission charges, aviation charges, and courier services. The denial was based on the premise that these services did not qualify as input services under Rule 2(l) of the Cenvat Credit Rules, 2004, and some services were availed beyond the place of removal, i.e., factory gate. The Tribunal heard both sides and examined the case.

Regarding clearing charges paid to the Custom House Agent (CHA) in export of goods, the Tribunal noted that the CHA services were availed by the appellant in the course of export, where the place of removal is the port. Citing a precedent from the Honorable High Court of Bombay, the Tribunal held that as a manufacturer of excisable goods, the appellant is entitled to take input service credit for services availed in the course of their business activity. Since it was undisputed that the appellant availed all services in the course of their business, the Tribunal concluded that the appellant is entitled to input service credit on all the services in question. As a result, the impugned order denying the credit was set aside, and the appeal was allowed with consequential relief.

In summary, the Tribunal ruled in favor of the appellant, holding that they are entitled to input service credit on the services in dispute. The decision was based on the interpretation of relevant rules and a precedent establishing the eligibility of manufacturers to claim such credits for services availed in the course of their business activities.