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TMI Blog2016 (7) TMI 294X X X X Extracts X X X X X X X X Extracts X X X X ..... lant Mr. Ajay Saxena, A.R., For the Respondent ORDER PER : S.S GARG The present appeals is directed against order of the Commissioner (Appeals) dated 14.4.2011 vide which the Commissioner(Appeals) has rejected the appeal of the appellant by denying him the credit of service tax paid on GTA services. 2. Briefly the facts of the present case are that the appellants are the manufacturers of graphite electrodes and nipples and graphite products which are dutiable. On scrutiny of the records for the period November 2008 to August 2009, the department found that the appellants have filed CENVAT credit of service tax paid on transportation and freight charges in respect of transportation of finished goods from the factory up to the customers premises as well as to the port in case of export of final products. Thereafter the department issued a show-cause notice dated 30.10.2009. The appellant filed a reply to the show-cause notice and the adjudicating authority vide order dated 14.12.2010 disallowed the credit and thereafter the appeal was filed before the Commissioner (Appeals) who upheld the order of the adjudicating authority and rejected the appeal and hence th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y documents/agreements, transportation wise bills in full (transaction wise) showing the payment of service tax in respect of their claim before the adjudicating/appellate authority, Hence, I am of the opinion that the appellants have not fulfilled the conditions as laid down in the said Boards Circular and therefore all the clearances of the appellants have to be considered to have been made at the factory gate and they are not eligible for services tax credit availed by them on outward freight. I find from records that the original authority has disallowed cenvat credit in respect of service tax paid on outward freight charges from the factory premises to the customers premises on the ground that the appellants have not fulfilled the conditions under para 8.2 of Boards circular no 97/8/2007-ST dated 23.08.2007. Boards circular mentioned above confirms/clarifies that the assessee is allowed to take credit, subject to satisfying the conditions mentioned in Para (i) (ii), and (iii) of the circular and para (iii) reads as under: (iii) the freight charges were an integral part of the price of goods. In such cases, the credit of the service tax paid on the transportation up t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e original adjudicating authority at para 15 of the impugned order is not in fulfillment of condition No (ii) of aforementioned Board s Circular i.e., seller bore the risk of loss or damage to the goods during transit to the destination. The terms of sale contract if it is EXW (Ex-works), then the seller s (appellants) responsibility is to make available goods to their customers at the factory gate. The buyer bears the full cost risk involved in bringing from there to the desired destination. Accordingly, the seller is under minimum obligation. In either of the above two situations, it is clear that the ownership of the goods did not vest with the appellant till the delivery of the goods and therefore the appellants cannot claim that they bore the risk. In the presence of clear findings of the adjudicating authority, I am not under any obligation to accept the contention of the appellants that they have fulfilled all the requisites of Boards Circular. The reliance placed by the Hon ble Tribunal on the decision of Punjab and Haryana High Court in the case of Gujarat Ambuja Cements Vs UOI [2009(14)STR 3 (P H)] is not applicable to the present dispute as the facts involved are clea ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 4, the wrongly availed Cenvat Credit is rightly recoverable under the provisions of rule 14 with interest ibid. The notice does not invoke suppression and as the issue under the knowledge of the department, nominal penalty (in lieu of the mandatory penalty] has been imposed under rule 15(3) ibid. I am of the opinion that the order issued by the original authority is a well reasoned one which does not warrant any interference. The Honble Punjab Haryana High Court, observing that the Boards Circulars are binding on the department held that revenue is precluded from challenging correctness of their own circular even on the ground of it being inconsistent with statutory provisions. Boards Circular No 97/8/2007 S.T. dated 23.08.2007 had clarified as under: para 8.1(c): Issue: Up to what stage a manufacturer/consignor can take credit on the service tax paid on goods transport by road? Comments: This issue has been examined in great detail by the CESTAT in the case of M/s Gujarat Ambuja Cements Ltd Vs CCE Ludhiana [2007(006)STR 0249 Tri-D]. In this case, CESTAT has made the following observations:- the post sale transport of manufactured goods is not an input for the manu ..... X X X X Extracts X X X X X X X X Extracts X X X X
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