2017 (2) TMI 206 - AT - Central Excise

Refund - Unutilized cenvat credit - Outward transportation - Rule 5 of Cenvat Credit Rules, 2004 - Held that - It was held in number of cases, in case of exports the place of removal stands extended to the port of export as the ownership of the export goods remains with the exporter till the goods is shipped and sailed to foreign country from the port. Therefore, the port being a place of removal the cenvat credit in respect of GTA from factory to the port of export is clearly admissible - Appeal allowed.

Summary

Issues:
Refund claim for unutilized Cenvat Credit on outward transportation for export beyond place of removal.

Analysis:
The appellant's refund claim for unutilized Cenvat Credit was partially allowed, with part of the amount rejected due to the belief that the credit on outward transportation for export beyond the place of removal was not covered under the definition of input service. The appellant argued that the service of Goods Transport Agency (GTA) for transportation of goods from the factory to the port for clearance of export goods made the credit admissible. The appellant cited various judgments and a Board Circular to support their claim.

The Assistant Commissioner for the Revenue reiterated the findings of the impugned order, leading to a detailed consideration by the Member (Judicial). After careful consideration of both sides' submissions, it was established that the GTA service availed by the appellant was indeed for the removal of export goods from the factory to the port of export. It was noted that in cases of exports, the place of removal extends to the port of export, as the ownership of the export goods remains with the exporter until the goods are shipped from the port to a foreign country. Therefore, the port was considered a place of removal, making the Cenvat credit for GTA from the factory to the port of export admissible. The Member (Judicial) relied on the judgments cited by the appellant's counsel to support this view, ultimately allowing the appeal and setting aside the impugned order. Consequently, the appellant was deemed entitled to the Cenvat credit of GTA, and the refund under Rule 5 of the Cenvat Credit Rules, 2004 was also considered admissible. The judgment was pronounced in court on 30/12/2016.