2024 (9) TMI 838 - AT - Service Tax

CENVAT Credit - input service - outward transportation service - period from 1st April, 2006 to 31st October, 2007 - HELD THAT - The issue is also settled by the Hon ble Apex Court in the case of COMMISSIONER OF CENTRAL EXCISE, BELGAUM VERSUS M/S. VASAVADATTA CEMENTS LTD. 2018 (3) TMI 993 - SUPREME COURT , wherein the Hon ble Supreme Court has held ' Thus from 1-4-2008, with the aforesaid amendment, the Cenvat credit is available only upto the place of removal whereas as per the amended Rule from the place of removal which has to be upto either the place of depot or the place of customer, as the case may be.' As the issue has already been settled up to 01.04.2008, the assessee is entitled to claim the cenvat credit on outward goods transportation service up to the place of removal. Thus, the appellant is entitled to take the cenvat credit on outward transportation service. Accordingly, the demand confirmed in the impugned order is set aside and no penalty is imposable on the appellant. The impugned order is set aside - appeal allowed.

Summary

Issues:
Appeal against denial of cenvat credit for outward transportation service.

Analysis:
The appellant, engaged in sponge iron manufacturing, availed "container services" for outward transportation of final products from M/s CONCOR from April 2006 to October 2007, claiming cenvat credit. Revenue denied the credit, issuing a show-cause notice in November 2008. The appellant's contention was rejected by lower authorities, leading to the current appeal.

The appellant's counsel cited precedents, including a Karnataka High Court decision and a Supreme Court case, to support the claim for cenvat credit on outward transportation service. The Revenue's authorized representative reiterated the findings of the impugned order.

The Tribunal considered the submissions and referred to a Supreme Court judgment regarding the definition of "input service" in relation to the transportation of final products from the place of removal. The Tribunal highlighted that the tax paid on transportation up to the first point, whether depot or customer, should be allowed as cenvat credit. An amendment effective from April 1, 2008, clarified that credit is available only up to the place of removal.

Based on the settled issue up to April 1, 2008, the Tribunal held that the appellant is entitled to claim cenvat credit on outward transportation service up to the place of removal. Consequently, the demand in the impugned order was set aside, and no penalty was imposed on the appellant. The appeal was allowed with any consequential relief.