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TMI Blog2013 (8) TMI 719X X X X Extracts X X X X X X X X Extracts X X X X ..... d on inputs and capital goods and service tax paid on inputs services used in or in relation to the manufacture of their final products. The dispute in this case is as to whether the appellant are eligible for Cenvat credit of service tax paid on GTA Service availed for outward transportation of finished goods from the factory gate to the customer's premises. The appellant during the period from Jan' 05 to Nov.' 05 and from Nov.' 05 to August' 06 took Cenvat credit of Rs. 11,71,026/- and Rs. 12,66,789/- respectively, in respect of outward freight for transportation of finished goods from the factory gate to the customer's premises, as according to the appellant, their sales are on FOR destination basis and it is the customer's premises whic ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ore, it is the customer's premises which have to be treated as the 'place of removal', that therefore, the transportation up to the customer's premises has to be treated as "transport up to the place of removal" and the same would be eligible for Cenvat credit, that Cenvat credit in respect of outward transportation is also admissible, in view of the judgment of Hon'ble Karnataka High Court in the case of Commissioner Central Excise and Service Tax LTU, Banglore v. ABB Limited, reported in 2011 (23) S.T.R. 97 (Kar.) and also the judgment of Hon'ble Gujarat High Court in the case of Commissioner of Central Excise & Customs v. Parth Poly Wooven Pvt. Ltd., reported in 2012 (25) S.T.R. 4 (Guj.), that in these judgments, it has been held in clea ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cular 23-8-2007, that the above judgment of Hon'ble Punjab & Haryana High Court has been relied upon by Hon'ble Karnataka High Court in the case of CCE, Bangalore v. ABB Ltd. (supra), that in view of this the Cenvat credit of service tax paid on GTA service availed for outward transportation of finished goods from the factory gate to the customer's premises would be admissible only when the sales are on FOR basis in term of the criteria prescribed in the above mentioned Circular of the Board, that in these cases there is no evidence that the criteria for the sales being on FOR destination basis, as prescribed on the Board's Circular dated 23-8-2007 has been satisfied, and that in view of this, there is no infirmity in the impugned orders. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rt charges up to the customer's premises are integral part of the value of the goods that is the value on which excise duty has been paid. According to the above mentioned Circular of the Board if the sales satisfy the above criteria the same are to be treated as on FOR destination basis and in that case the customer's premises would be the "place of removal" and Cenvat credit of service tax paid on the GTA services availed for transit up to the customer's premises would be admissible. 6. Hon'ble Punjab & Haryana High Court in case of Ambuja Cement Ltd. v. Union of India (supra) relying upon the above circular of the Board has held that Cenvat credit of service tax paid on GTA services availed for outward transportation of the finished go ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... High Court. In para 31 of the judgment Hon'ble High Court has specifically held that expression - "activities relating to business" in the inclusive part of the definition of input service does not cover, outward transportation from the factory. In this judgment, Hon'ble High Court in Para 23 of the judgment after framing the question "The question is up to what stage after manufacturing of the product, the "service" rendered in transporting the finished goods from the place of removal up to the place of delivery, constitutes "input service" as defined under the Cenvat Credit Rules, 2004, has - (a) in Para 29 of the judgment held that when the sales are on FOR destination basis, satisfying the criteria prescribed in this regard in the Boa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 'place of removal' and in that case, GTA service availed for transportation of the finished goods up to the customer's premises would be the input service' eligible for Cenvat credit. Thus, the ratio of the judgment of Hon'ble Karnataka High Court in the case of C.C.E. v. ABB Ltd., (Supra), is the same as the ratio of Hon'ble Punjab & Haryana Court in the case of Gujarat Ambuja Cement (supra), and the ratio of both of judgments is that the Cenvat credit of services tax on GTA service availed for outward transportation of finished goods up to the customer's premises would be admissible only when the sales are on FOR destination basis and duty at ad valorem rate has been paid on the FOR destination price. In this regard, observations of the H ..... X X X X Extracts X X X X X X X X Extracts X X X X
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