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TMI Blog2010 (5) TMI 699X X X X Extracts X X X X X X X X Extracts X X X X ..... ) disallowing Credit availed by the Appellant on Service Tax paid on outward freight upto port of export. 2. The appellant is engaged in the manufacture of Polyester Staple Fibre (PSF) and Tow falling under Chapter 55 of the Central Excise Tariff Act, 1985 and is availing Cenvat credit under Cenvat Credit Rules, 2002/2004. They have availed credit of service tax paid on outward freight upto port from where goods are exported and Show Cause Notice was issued for denying the said credit. The Assistant Commissioner, Central Excise, Div-II, Lucknow, vide the impugned order has dis-allowed the Cenvat Credit on outward freight upto port from where goods are exported, amounting to Rs. 1,36,180/- and confirmed the same under Section 11A of the Ce ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Department and proviso to Section 11A(1) of the Central Excise Act, 1944 is invocable for recovery of dues. 3. Being aggrieved with the aforesaid Order, the Appellants filed appeal, wherein appellants contended that : (i) Under Section 4(3)(c)(iii) of the Central Excise Act, 1944, place of removal means ..or any other place or promises from where the excisable goods are to be sold after their clearance from the factory..... In case of export, goods can leave the country only when they leave the port of export this is similar to selling goods from depot or consignment agent. Therefore, GTA service rendered for transportation of goods for export upto the port of export are eligible for availing credit. (ii) As per Section 2(h) of th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lar No 97/8/2007-S.T., dated 23-8-2007 and said that :- Exporter continue to remain owner of goods in question till same are exported since place of removal of goods in export is port area, services availed by the exporter till port are input service in as much same are related to business activities. In view of the above, they are entitled for Cenvat credit of service tax paid on transportation of goods upto the port of export which is a place of removal. (iv) As they are filing monthly ER-1 returns including input/input service credit register, from time to time and the fact of availment of credit is disclosed, invocation of longer period of limitation beyond the normal period of one year as provided under Section 11A(1) is not o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... vice which are for outward transportation in case of export goods i. e. upto port of export. Discussion Findings 6. I have carefully considered the grounds of appeal, written submission made by the appellant, the arguments advanced during personal hearing and also the provisions of law governing the subject matter. The main issue involved in the case is whether the appellant is eligible to avail CENVAT credit on service tax paid on GTA service which are for outward transportation in case of export goods, upto port of export i. e. whether in case of export of goods, can the port of export be treated as place of removal? 7. The appellant has contended that in case of export actual sale take place at the port of export. The sale is tre ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nce from the factory. As per definition of sale, a transaction is recognized as sale only when it is realized or can be quite easily realized meaning the seller has realized or has a high chance of realizing payment against delivery of goods. In case of export, goods are treated as sold only when they leave the shores of India and the exporter realizes payment (through letter of credit) after producing proof of goods having left the shores of India. In case of export goods, therefore, the place of removal has been held to be port of export and hence, credit of service tax paid on GTA services used for transportation upto port of export is admissible. As Cenvat credit on the such GTA service is admissible, there is no question of demand of ..... X X X X Extracts X X X X X X X X Extracts X X X X
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