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2019 (3) TMI 410 - AT - Central ExciseCENVAT Credit - input services - GTA Services - Held that - In this case, it is an admitted fact on record that the goods were removed from the factory of the appellant for onward sale to its buyers and for that purpose, the GTA service was availed by the appellant. Thus, as per the judgment of Hon ble Supreme Court in the case of Commissioner of Central Excise and Service Tax Vs. Ultra Tech Cement Ltd. 2018 (2) TMI 117 - SUPREME COURT OF INDIA , GTA service should not be considered as input service for availment of Cenvat benefit. Penalty - Held that - The issue was highly contentious and resolved by the judgment of Hon ble Supreme Court - penalty not attracted in the present case. Appeal allowed in part.
Issues: Denial of Cenvat benefit on GTA service; Imposition of penalty on the appellant
Issue 1: Denial of Cenvat benefit on GTA service The judgment addresses the denial of Cenvat benefit on GTA service. It refers to the Hon'ble Supreme Court's ruling in the case of Commissioner of Central Excise and Service Tax Vs. Ultra Tech Cement Ltd., which clarified that services used for transportation of goods "up to the place of removal" should be considered as input service. The appellant had availed GTA service for transporting goods from their factory for sale to buyers. The judgment highlights that GTA service should not be considered as an input service for Cenvat benefit based on the Supreme Court's decision. Despite the contentious nature of the issue, the imposition of penalty on the appellant is deemed inappropriate as the matter was ultimately settled by the Apex Court. The Tribunal's decision in a similar case further supports the view that penalty imposition is not justified in such circumstances. Issue 2: Imposition of penalty on the appellant The judgment discusses the imposition of a penalty on the appellant in light of the denial of Cenvat benefit on GTA service. It notes that the penalty cannot be sustained for judicial scrutiny given the settled nature of the issue by the Hon'ble Supreme Court. The Tribunal's decision in a comparable case where the penalty was set aside due to the debatable nature of the Cenvat Credit availment issue further strengthens the argument against imposing a penalty. Consequently, the impugned order is set aside, and the appeal is allowed to the extent of the penalty imposition on the appellant, while sustaining the denial of Cenvat benefit on the GTA service. The judgment partially favors the appellant by setting aside the penalty. In conclusion, the judgment provides a detailed analysis of the issues surrounding the denial of Cenvat benefit on GTA service and the imposition of a penalty on the appellant. It cites relevant legal precedents, including the Supreme Court's decision, to support its findings. The decision ultimately favors the appellant by setting aside the penalty but upholds the denial of Cenvat benefit on the GTA service.
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