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TMI Blog2016 (9) TMI 45X X X X Extracts X X X X X X X X Extracts X X X X ..... on the outward freight during the relevant period was correctly taken by the appellant. - Decided in favour of appellant - Appeal No. E/327/2011 - ORDER No. FO/A/75907/16 - Dated:- 25-8-2016 - Shri H. K. Thakur, Member (Technical) Shri Ravi Raghavan, Adv M/s Satabadi Chatterjee, Advocate for the Appellant Shri S. Mukhopadhyay, Suptd (AR) for the Revenue ORDER Per Shri H. K. Thakur This appeal has been filed by the appellant against OIA No. 07/SH/CE(A)/GHY/11 dt 14/2/2011 passed by Commissioner (Appeals) Guwahati as first appellant authority. Under this OIA dt 14/2/2011 first appellate authority has predominantly upheld the OIA dt 29/7/2009 passed by the Adjudicating authority. 2. Ravi Raghavan (Advocate) and Ms Stabadi Chatterjee (Advocate) appeared on behalf of the appellant. Sh. Ravi Raghavan argued that issue involved in the present appeal is whether service tax credit with respect to outward transportation is admissible to the appellant or not. That appellant is a cement manufacturer where Central Excise duty is paid on MRP basis. That goods are delivered to the doorsteps of the customers transit insurance is also borne by the appellant. That a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sue following observations were made by the P H court while deciding the case against the Revenue:- 7. Having heard learned counsel at a considerable length and perusing the paper book and statutes with their able assistance, we are of the view that the questions of law deserve to be answered in favour of the assessee-appellant and against the revenue. It is undisputed that the appellant being a manufacturer and consigner has paid service tax on the value of goods transported by it by road. The Central Board of Excise and Customs (CBEC) has issued a circular dated 23-8-2007 dealing with the issue concerning up to what stage manufacturer/consigner could take credit on the service tax paid on goods transported by it by road . The issue, in fact, has emerged out of the order of the Tribunal passed in the case of the appellant itself. The Board has opined that the phrase place of removal has to be determined by taking into account the facts of each case. According to the circular, the expression place of removal has been defined by Section 4 of the 1944 Act and according to sub-rule (t) of Rule 2 of the CC Rules, if any words or expression used in those rules are not defined but ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tment. Placing reliance on earlier judgments of the Supreme Court in the cases of CCE v. Usha Martin Industries, 1997 (94) E.L.T. 460 (S.C.) = (1997) 7 SCC 47; Ranadey Micronutrients v. CCE, 1996 (87) E.L.T. 19 (S.C.) = (1996) 10 SCC 387; CCE v. Jayant Dalal (P) Ltd., 1996 (88) E.L.T. 638 (S.C.) = (1997) 10 SCC 402 and CCE v. Kores (India) Ltd., 1997 (89) E.L.T. 441 (S.C.) = (1997) 10 SCC 338, Hon ble the Supreme Court concluded in para 5 as under :- 5. It is clear from the abovesaid pronouncements of this Court that, apart from the fact that the Circulars issued by the Board are binding on the Department, the Department is precluded from challenging the correctness of the said Circulars even on the ground of the same being inconsistent with the statutory provision. The ratio of the judgment of this Court further precludes the right of the Department to file an appeal against the correctness of the binding nature of the Circulars. Therefore, it is clear that so far as the Department is concerned, whatever action it has to take, the same will have to be consistent with the Circular which is in force at the relevant point of time. 10. It is, thus, evident that the revenue ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... has also remain un-controverted that for transportation purposes insurance cover has also been taken by the appellant which further shows that the ownership of the goods and the property in the goods has not been transferred to the seller till the delivery of the goods in acceptable condition to the purchaser at his door step. Accordingly, even the second condition that the seller has to bear the risk of loss or damage to the goods during transit to the destination stand fulfilled. 13. The third condition that the freight charges were integral part of the excisable goods also stand fulfilled as the delivery of the goods is FOR destination price. This aspect has been specifically pointed out in para 2.2 of the reply dated 12-4-2006 given to the show cause notice. Therefore, we are of the view that the first question is liable to be answered in favour of the assessee and against the revenue. 5. Learned AR has relied upon the case law of Apex Court CC CE Nagpur Vs Ispat Industries Ltd (Supra) to argue that Customers premises can not be the place of removal that no Cenvat Credit on outward freight will be admissible. The period of dispute before Apex Court in the above ca ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rly selling their goods on the bssis of purchase order, which clearly stipulates that 100% payment will be only on receipt of goods delivered at the premises of the buyer. Upto that the insurance and transport of the goods is at the vendor s cost. In these factual circumstances, the respondent have undertaken the transportation and the value of such transportation is apparently included for the purpose of discharging central excise duty on the finished goods. the freight was integral part of the value in the present case has been admitted by the original Authority. Such being the case, it is not open to Revenue to rely on the decision of the Hon ble Supreme Court as stated above to hold that the respondent are not eligible for cenvat credit on freight element though admittedly, such freight forms part of the assessable value. Such assertion will result in self- contradiction. 6. In the present proceedings transit insurance outward freight is also borne by the appellant. Ownership of the goods till their delivery at the footsteps of the buyer remains with the appellant and service tax on freight is also paid by the appellant. Under the existing factual matrix deliveries of ce ..... 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