2015 (3) TMI 338 - AT - Central Excise

Denial of CENVAT Credit - GTA Service - Place of buyer - Place of removal - Held that - Commissioner (Appeal) relied on Board Circular No.97/8/07-ST dated 23.08.2007 dealing with the claim of Cenvat credit on GTA service availed by the assessee in respect of delivery of the goods with the condition of FOR destination. Upon examination of certain conditions, he came to the conclusion that the goods were delivered at the place of buyer carrying ownership of the goods with the manufacturer till the place of the buyer. Thus, the goods were removed at the place of buyer, not elsewhere. To this conclusion, there is no rebuttable evidence brought out by the Revenue in its appeal - when the property of goods was all along lying with the assessee and that was divested only at the place of buyer, it cannot be said that place of removal was other than the place of the buyer, where delivery of the goods occurred. In such a situation the Circular binds the Department to allow the appropriate Cenvat credit. - Decided against Revenue.

Summary

Issues:
1. Interpretation of Board Circular No.97/8/07-ST regarding Cenvat credit on GTA service for delivery of goods with FOR destination condition.
2. Determination of the place of removal of goods for the purpose of Cenvat credit eligibility.

Analysis:
1. The judgment primarily revolves around the interpretation of Board Circular No.97/8/07-ST concerning the claim of Cenvat credit on GTA service for delivering goods with a FOR destination condition. The Commissioner (Appeal) analyzed the conditions and concluded that the goods were delivered at the buyer's place, with ownership transferring from the manufacturer to the buyer at that point. The absence of rebuttable evidence by the Revenue further supported this conclusion. The appellant's counsel highlighted the tender document, emphasizing that the property of goods remained with the assessee until delivery at the buyer's place, aligning with the Circular's principles for allowing Cenvat credit.

2. The issue of determining the place of removal of goods was crucial in deciding the appellant's entitlement to Cenvat credit on GTA service. The Revenue contended that the place of buyer did not constitute the place of removal, thus challenging the Commissioner's order. However, the respondent effectively countered the Revenue's argument by presenting detailed evidence and arguments in line with the Circular's guidelines. Ultimately, the Tribunal, considering the Circular's rationale and the respondent's submissions, dismissed the Revenue's appeal, affirming the eligibility of Cenvat credit for the appellant based on the delivery location of the goods.

In conclusion, the judgment clarifies the application of Board Circular No.97/8/07-ST in determining Cenvat credit eligibility for GTA service related to goods delivery with a FOR destination condition. It underscores the significance of establishing the place of removal of goods, with the Tribunal upholding the Commissioner's decision in favor of the appellant due to the alignment of delivery location with ownership transfer. The detailed analysis and reliance on legal principles and evidence ensure a comprehensive resolution of the issues raised in the appeal.