2018 (7) TMI 686 - AT - Central Excise

CENVAT Credit - input services - outward transportation of goods for the goods cleared from their factory gate to their own units at Jamshedpur and Uttarakhand - Stock transfer - place of removal - periods September 2009 to February, 2010 and October 2014 to April 2015, May 2015 to February 2016. Held that - The Hon ble Apex Court in the case of Ultratech Ltd. 2018 (2) TMI 117 - SUPREME COURT OF INDIA had laid the law that after 1.4.2008 CENVAT credit on GTA service is not eligible from the factory to buyer s premises and eligible only upto the place of removal which is the factory gate - credit cannot be allowed. Appeal dismissed - decided against appellant.

Summary

Issues:
1. Disallowance of CENVAT credit on outward transportation of goods for stock transfer.
2. Interpretation of "place of removal" for availing CENVAT credit.

Analysis:
1. The appellants availed CENVAT credit on outward transportation of goods for stock transfer to their own units. The issue revolved around whether the place of removal for availing credit should be considered as the factory gate or the destination unit. The appellant argued that as there was no sale at the factory gate for stock transfers, the place of removal should be deemed as the destination unit. They relied on legal provisions and precedents to support their stance, including the judgment in Commissioner Vs. Roofit Industries Ltd. The appellant contended that GTA services used for transportation should be considered up to the place of removal, i.e., the destination unit, not the factory gate.

2. The respondent supported the findings in the impugned order, citing the judgment in Commissioner of Central Excise Vs. Ultratech Ltd. The respondent argued that as per the judgment, CENVAT credit on GTA services after 1.4.2008 is not eligible beyond the factory gate. The respondent emphasized that the word "upto the place of removal" in the definition of input services post-2008 signifies the terminating point for credit eligibility, closing the benefit at the factory gate. The respondent contended that the appellant's reliance on previous judgments was overridden by the Ultratech Ltd. judgment, which clarified the eligibility limit for CENVAT credit on GTA services.

3. The Tribunal examined the legal provisions and precedents cited by both parties. It noted the change in the definition of input services post-2008, emphasizing the limitation of credit eligibility "upto the place of removal." The Tribunal acknowledged the conflicting judgments presented by the appellant and the respondent but ultimately followed the ruling in Ultratech Ltd. The Tribunal concluded that post-2008, CENVAT credit on GTA services is not admissible beyond the factory gate to the buyer's premises. Therefore, the Tribunal held that the credit was not eligible in this case, upholding the impugned orders and dismissing the appeals.

This detailed analysis of the judgment highlights the key legal arguments, interpretations of relevant provisions, and the Tribunal's decision based on the precedents cited by the parties.