2015 (5) TMI 771 - AT - Central Excise

Waiver of pre deposit - Denial of CENVAT Credit - GTA Service - claim of the appellants is that the CENVAT Credit is taken in respect of cement wherein the appellants bore the freight and supplied the goods at the premises of customers on FOR destination basis - Held that - Decision of the Hon ble Supreme Court 2002 (10) TMI 96 - SUPREME COURT OF INDIA may not be applicable to the facts of this case since in that case, factory gate was admittedly the place of removal and there was no dispute about the place of removal. In the case of Madras Cements Ltd., the decision was rendered prior to the period 01/04/2008 and further it was held that prior to 01/04/2008 only credit was admissible. We are considering the period subsequent to 01/04/2008. However, in cases like this, it has to be taken note that the decisions have to be rendered on the basis of fact. On going through the invoices, we find that as claimed by the learned counsel, freight has been paid by them and further the sale is on MRP basis and duty has been arrived on the basis of MRP - appellant has made out a prima facie case in their favour. Accordingly, the requirement of predeposit is waived and stay against recovery is granted during the pendency of appeal. - Stay granted.

Summary

Issues:
1. Availing CENVAT credit for GTA service.
2. Determining the place of removal for CENVAT credit eligibility.
3. Discrepancy in decisions by different Commissioners.
4. Applicability of legal precedents.
5. Prima facie case for waiver of predeposit and stay against recovery.

Analysis:
1. The appellant, engaged in cement manufacturing, availed CENVAT credit under CENVAT Credit Rules 2004 for inputs, input services, and service tax paid as a receiver of GTA service. The dispute arose regarding the eligibility of CENVAT credit for cement where the appellant bore the freight and delivered goods at buyers' premises on FOR destination basis. Three show-cause notices were issued, leading to the confirmation of a demand for CENVAT credit availed during a specific period, along with interest and penalty.

2. The Commissioner's stand was that the factory, not the buyers' premises, should be considered the place of removal since the invoice was prepared at the factory. Additionally, the ownership of goods was questioned as they were handed over to the transporter. The appellant argued consistency with a previous Commissioner's order and cited relevant case laws to support their claim for CENVAT credit eligibility.

3. Discrepancy in decisions by different Commissioners was highlighted, where a previous order favored the appellant's eligibility for CENVAT credit on similar grounds. The appellant emphasized the similarity in circumstances and documentation processes between the periods covered by the contrasting orders.

4. Legal precedents were invoked by both parties, with the appellant relying on decisions like Ambuja Cements Ltd. Vs. UOI and Ultra Tech Cement Ltd. Vs. CCE, Raipur, while the learned AR cited judgments such as Escorts JCB Ltd. Vs. CCE, Delhi-II and Madras Cements Ltd. Vs. CCE, Bangalore to support their arguments.

5. After considering submissions and examining invoices, the Tribunal found in favor of the appellant. The Tribunal distinguished previous judgments based on the period and factual considerations, ultimately concluding that the appellant had established a prima facie case in their favor. Consequently, the requirement of predeposit was waived, and a stay against recovery was granted pending the appeal process.