2009 (7) TMI 897 - AT - Service Tax

Cenvat Credit- Circular No. 97/8/2007/ST, dated 23.08.2007- Whether the respondent is entitled for Cenvat Credit on service tax paid for outward transportation under goods transport agency services? Held that- the lower authorities have not given any finding on the parameter laid down in the circular No. 97/8/2007/ST, dated 23.08.2007 thus the remand back the matter to the original authority.

Summary

Issues:
- Entitlement to Cenvat credit on Service Tax paid for outward transportation under Goods Transport Agency.

Analysis:
1. The primary issue in this appeal is the entitlement of the respondent to Cenvat credit on Service Tax paid for outward transportation under Goods Transport Agency. The respondent argues that the service of outward transportation up to the place of removal qualifies as an input service for the manufacturer as explicitly mentioned in the definition. They contend that outward freight for the clearance of final products from the place of removal is covered under the service of GTA of outward transportation only up to the factory gate or depot, which is the place of removal in this case. The respondent relies on the decision in ABB Ltd. v. CCE&ST [2009] 21 STT 77 (Bang. - CESTAT) (LB) to support their stance that the goods transport agent service for outward transportation of goods from the place of removal is an input service eligible for Cenvat credit.

2. On the other hand, the Judicial Departmental Representative (JDR) referred to Board Circular No. 97/8/2007/ST and the case of Ambuja Cements Ltd. v. Union of India [2009] 20 STT 182 (Punj. & Har.) to present an opposing view. The JDR highlighted the definition of 'place of removal' as per the Circular, emphasizing that the parameters laid down in the Circular need to be fulfilled by the assessee to avail Cenvat credit on GTA service. The JDR pointed out that the lower authorities did not address the parameters outlined in the Circular during the proceedings, as the period involved predated the Circular's issuance.

3. Upon reviewing the record, it was noted that the lower authorities did not provide any findings on the parameters specified in the Circular referred to by the JDR. As the period in question precedes the Circular, the matter was remanded back to the original adjudicating authority for a thorough examination in light of Circular No. 97/8/2007/ST, dated 23-8-2007. The original adjudicating authority was instructed to reevaluate the case and issue an appropriate order after affording both parties an opportunity to be heard, preferably within four months of receiving the remand order.