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2019 (12) TMI 637 - AT - Central ExciseCENVAT Credit - input services - outward GTA services - period from 1-4-2005 to 31-3-2007 - HELD THAT - Cenvat credit on outward GTS service was admissible since in the judgement of Hon ble Supreme Court in the case of COMMISSIONER OF CENTRAL EXCISE, BELGAUM VERSUS M/S. VASAVADATTA CEMENTS LTD. 2018 (3) TMI 993 - SUPREME COURT , it was observed that tax paid on transportation of final products from the place of removal upto the first point may it be depot or the customer s place has to be allowed. The ground of rejection of admissibility of such Cenvat Credit on outward GTA by the adjudicating authority and its confirmation by the Commissioner (Appeals) was the want of documents by way of additional evidence to justify that transfer of goods occurred at the customers place to bring the case of the appellant within the conditions stipulated in CBSC Circular dated 23-08-2007, whereas show cause Notice itself confirmed that the transportation of goods from the point of manufacturer up to the place of removal (para 4) had occurred which went to the knowledge of respondent department during the course of CERA Audit conducted on the record of the assesse (para-2 of show cause-cum-demand Notice dated. 24-3-2010). Such rejection of appeal on narrow technical consideration by the Commissioner (Appeals) is unsupported by the principle of fair justice and good conscience - appeal allowed - decided in favor of appellant.
Issues:
Refusal of lower authorities to accept availment of Cenvat Credit by the appellant on outward GTA services for the period from 1-4-2005 to 31-3-2007. Analysis: The case involved the refusal of lower authorities to accept the availment of Cenvat Credit by the appellant on outward GTA services during a specific period. The appellant had availed CENVAT Credit of a certain amount on Service Tax for outward transportation of final products up to the customer's premises. The respondent department contended that such credit was not covered within the definition of input service as per Rule 2(l) of the CC Rules, 2004. The matter was adjudicated, resulting in duty demand, penalty, and interest being confirmed. The legality of this order was challenged in the appeal. During the relevant period, the definition of "input service" under Rule 2(l) of CCR 2004 was crucial. The definition included services used in relation to various activities, including transportation of inputs or capital goods and outward transportation up to the place of removal. The appellant argued that tax paid on outward GTA services was eligible for Cenvat Credit, citing judgments from the Karnataka High Court and the Supreme Court supporting this view. In contrast, the respondent department relied on a case law to argue against the admissibility of such credit. The judgments cited by both parties highlighted that Cenvat credit on outward GTA services was admissible during the period in question. The Supreme Court's observation in a specific case supported the allowance of tax paid on transportation of final products up to the first point, whether a depot or the customer's place. The rejection of admissibility by the lower authorities based on the lack of additional evidence was deemed unjustified, especially considering the information available in the show cause notice itself. The Tribunal found the rejection of the appeal on technical grounds unsupported by principles of fair justice and good conscience. Consequently, the appeal was allowed, and the order of the Commissioner of Central Excise (Appeals) was set aside. The judgment emphasized the importance of considering the specific circumstances and available evidence in such cases to ensure a fair and just decision.
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