2019 (11) TMI 1123 - AT - Central Excise

CENVAT Credit - input services - GTA Services - the service used for removal of goods wherein the sale is on FOR basis - HELD THAT - The fact is no under dispute and all the documents related to the said fact has been submitted before the original authority which has been taken into consideration - As per the facts, the sale is on FOR basis, freight was borne by the appellant for clearance of the goods and the same is included in the assessable value on which excise duty is discharged. Under the same set of facts this Tribunal in the case of Ultratech Cement vs CCE Kutch 2019 (2) TMI 1487 - CESTAT AHMEDABAD after considering the Hon ble Supreme Court judgment in the case of Ultratech Cement 2018 (7) TMI 1574 - SC ORDER allowed the credit. Appeal allowed - decided in favor of appellant.

Summary

Issues involved:
- Entitlement for Cenvat credit in respect of GTA service used for removal of goods when the sale is on FOR basis.

Detailed Analysis:
The main issue in this case was whether the appellant is entitled to Cenvat credit for GTA service used for goods removal when the sale is on FOR basis. The appellant argued that since the sale is on FOR basis and freight is included in the assessable value on which excise duty was discharged, Cenvat credit on GTA should be admissible. The appellant relied on judgments such as Panoli Intermediates India Pvt. Ltd., Salasar Copper, and Ultratech Cement Ltd. On the other hand, the respondent reiterated the findings of the impugned order and cited judgments like CCE vs Ultratech Cement Ltd. and ALkraft Thermotechnologies P. Ltd.

The Tribunal examined the facts and documents related to the case, noting that the sale was indeed on FOR basis, with freight borne by the appellant and included in the assessable value for excise duty discharge. Referring to a previous judgment involving Ultratech Cement, the Tribunal highlighted that when goods are sold on FOR basis and ownership remains with the seller until delivery to the buyer, the seller is eligible for Cenvat credit on outward freight. The Tribunal also discussed the principles of determining the place of removal and point of sale based on relevant Supreme Court judgments.

Additionally, the Tribunal considered the argument regarding excise duty paid on freight exceeding the Cenvat credit on outward GTA, acknowledging the appellant's point but deciding the issue on merit. The Tribunal also addressed the appellant's reliance on circulars operative during the relevant period, emphasizing that beneficial circulars cannot be withdrawn retrospectively. Furthermore, the Tribunal noted that the issue of outward GTA has been a subject of litigation since the introduction of the Cenvat scheme, indicating no malafide intention on the appellant's part and rendering any demand for an extended period not sustainable on the grounds of time bar.

Ultimately, based on the facts and the precedent set by a previous decision, the Tribunal set aside the impugned order and allowed the appeal, ruling in favor of the appellant's entitlement to Cenvat credit for GTA service in the case of goods removal on FOR basis.