2015 (10) TMI 1967 - AT - Central Excise

Denial of CENVAT Credit - Various service - Held that - Services involved in the present case are already held by the Hon ble Gujarat High Court(2010 (5) TMI 483 - GUJARAT HIGH COURT ), to be eligible for CENVAT credit in respect of the goods exported by the assessee and the Hon ble Gujarat High Court has confirmed the CESTAT order passed by the Ahmedabad Bench in that case. In the case of Export of goods port is the place of removal . Following the decision of the Hon ble Gujarat High Court, I allow the appeal with consequential benefits. - in spite of stay order granted by this Tribunal, the Deputy Commissioner of Central Excise & Customs, Alibagh Division, Raigad has adjusted the total duty amount plus penalty plus interest involved in the aforesaid appeal against the appellant s duly sanctioned rebate claim for export of goods. - concerned authority directed to refund the adjusted amount with interest, as per Rules - Decided in favour of assessee.

Summary

Issues:
1. Denial of Service Tax credit for various services rendered after the 'place of removal'.
2. Adjudication based on the period before the amendment of 'place of removal'.
3. Adjustment of duty amount, penalty, and interest against rebate claim for export of goods.

Analysis:
1. The appellant contested the denial of Service Tax credit for services like port service, storage, cargo handling, CHA service, etc., arguing that these expenses were included in the FOB value of the exported goods and thus eligible for CENVAT credit. Reference was made to a judgment by the Hon'ble Gujarat High Court supporting the eligibility of such services for credit. The appellant's position was that since the goods were exported, the services should be creditable.

2. The Revenue, represented by the Addl. Commissioner, maintained that the denial of credit was based on a show-cause notice issued for the period before the amendment of the 'place of removal'. The adjudicating authority upheld the denial of credit on these services for the specified period. However, the appellant argued that the Gujarat High Court had ruled in favor of allowing credit for similar services in the context of exported goods.

3. Upon review, the Tribunal noted the Gujarat High Court's decision affirming the eligibility of services for CENVAT credit concerning exported goods. The Tribunal aligned with the Gujarat High Court's stance that 'port' constitutes the 'place of removal' for export transactions. Consequently, the appeal was allowed, granting consequential benefits to the appellant in line with the Gujarat High Court's ruling.

4. Additionally, it was highlighted that despite a stay order from the Tribunal, the Deputy Commissioner of Central Excise & Customs had offset the duty amount, penalty, and interest against the appellant's rebate claim for goods export. The Tribunal directed the concerned authority to refund the adjusted amount along with interest as per the rules, emphasizing the need for compliance with the Tribunal's directives for proper refund procedures.