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TMI Blog2019 (3) TMI 519X X X X Extracts X X X X X X X X Extracts X X X X ..... 2008 and also set aside the penalty. However, in respect of GTA services, the Adjudicating Authority and the Tribunal disallowed the input credit availed by the assessee beyond the RDCs/Corporate Office from 01.4.2008 and held that they are not eligible for the purpose of Rule 2(l) of the CCR as it stood after 01.4.2008. To arrive at the correct conclusion, the Adjudicating Authority should have taken note of the decision of the Hon'ble Supreme Court in the case of CCE, Belgaum Vs. Vasavadatta Cements Ltd. [2018 (3) TMI 993 - SUPREME COURT]. The issue, which fell for consideration before the Hon'ble Supreme Court was as to what interpretation has to be given to input services, which is defined in Rule 2(l) of the CCR. The appeals before the Hon'ble Supreme Court all related to a period prior to 01.4.2008 and the said Rule stood amended with effect from 01.4.2008. The issue requires to be examined in depth on the factual matrix and the Adjudicating Authority shall take note of the decision of the Hon'ble Supreme Court in the case of Vasavadatta Cements Ltd. - Appeal allowed by way of remand. - Civil Miscellaneous Appeal Nos.375 to 377, 402, 409, 413, 437, 446 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . 5. The specific case of the assessee is that they have factories at various locations in the country namely Hosur, Bangalore, Faridabad, Batagunj, Bata Nagar and their headquarters is at Gurgaon. Three of such factories are engaged in the manufacture of both excisable goods and non excisable goods and one is engaged in manufacturing only non excisable goods. The assessee would further contend that their marketing network consisted of regional distribution centres (RDCs), the retail shops at the grass root levels and whole sale distribution centres (WSDCs). The RDCs are located in Faridabad, Kolkatta, Bangalore and Thane and they are so located indicating the four regions namely northern region, eastern region, southern region and western region respectively. 6. The assessee's further case is that these RDCs utilized various capital goods and input services in connection with the manufacture of footwear across the country at various factories and distribution thereof. The normal marketing pattern and movement of goods are explained by the assessee as follows : a. footwears, dutiable or exempted, is manufactured in the factories of the appellant b. from the factorie ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... vices in question, on which, the CENVAT credit has been availed, were rendered at different places namely corporate office and the RDCs other than the place of manufacture and was not in consonance with the definition of the expression 'input services' wherein it was clearly stipulated that the services rendered should be in relation to manufacture or clearance of finished goods upto the place of removal. The show cause notices further stated that the factory must be considered as the 'place of removal' and that there can be no other 'place of removal' for the finished goods governed by Section 4A of the Act. In other words, the show cause notices proposed that in relation to such goods, the place of removal is nothing but the place of manufacture. The show cause notices also stated that since the goods from its factory were cleared to different RDCs after paying excise duty under Section 4A of the Act, no credit was available for the services rendered at the RDCs. 10. The assessee submitted their objections to the show cause notices, inter alia, contending that the usage of the phrases 'directly' or indirectly', 'in or in relation to' ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Adjudicating Authority. This is how, the assessee is before us by way of these appeals. 15. We need not elaborate much to take a decision on the point since the Adjudicating Authority, in fact, accepted the case of the assessee. We are convinced to say so in the light of the findings rendered by the Adjudicating Authority in paragraph 20 of the Order-in-Original dated 10.5.2010, which reads as follows : It is pertinent to mention here that on the issue whether a manufacturer manufacturing and clearing goods on payment of duty at specified rates (for example cement) or on the basis of valuation with reference to retail sale price (for example refrigerators) and selling the goods from a depot is also eligible to take credit of service tax paid on transportation of goods upto such depot, I find that the Board, vide letter F.No.137/3/2006 C.Ex.4 dated 02.2.2006 has clarified that : 'It may be recalled that under the CENVAT Credit Rules, 2004 (hereinafter referred to as 'Credit Rules'), the definition of 'input service' includes 'outward transportation up to the place of removal'. The expression 'place of removal' has not been defined in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... duty at specific rates or ad valorem rates on the basis of valuation under Section 4 or 4A of the Central Excise Act.' In view of the clarification given by the Board, I find that the contention of Bata is acceptable. However, in the instant case, the service tax credit distributed by the Regional Distribution Centres and the Corporate Office as discussed supra have no nexus with the manufacturing activity of Bata. Thus, the credit availed by Bata is not in order. 16. On a reading of the above paragraph, we find that the Adjudicating Authority held that in view of clarification given by the Board, vide letter dated 02.2.2006, the contention of the assessee was accepted. However, the next three sentences overturned the case of the assessee. The Adjudicating Authority held that the service tax credit distributed by the Regional Distribution Centres and the Corporate Office as discussed supra have no nexus with the manufacturing activity of the assessee and that the credit availed by the assessee was not in order. 17. We find that the Tribunal also, to an extent, accepted the case of the assessee, which could be seen from paragraph 5.1 of the impugned order, which rea ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ENVAT Credit Rules, 2004 is 'from the place or removal'. It has to be from the place of removal upto a certain point. Therefore, CENVAT credit of service tax paid on goods transport agency service availed of for transport of final product from the place of removal upto the first point, whether it is a depot or the customer's premises, has to be allowed. The amendment of Rule 2(l) with effect from April 1, 2008 by Notification No.10/2008 CE(NT) dated March 1, 2008, whereby the expression 'from the place of removal' was substituted by 'upto the place of removal' fortifies this view. Thus, from April 1, 2008, with the amendment, the CENVAT credit is available only upto the place of removal whereas under the unamended Rule, it was available from the place of removal upto either the place of depot or the place of customer, as the case may be. 20. To be noted that the subsequent decision of the Hon'ble Supreme Court in the case of CCE ST Vs. Ultra Tech Cement Limited [reported in 2018 (2) SCC 721] dealt with a case where the assessee had got finished goods (cement) from its parent unit on stock transfer basis and sold the same in bulk form and p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the findings of fact. Therefore, before the legal position is applied, a thorough exposition of the facts needs to be done. Then, law is to be applied to the facts of the case and not vice versa. 23. One more reason, which weighs in our mind, is to state that the Adjudicating Authority could have examined the factual background on account of a decision of the Delhi Tribunal in the case of CCE Vs. Lafarge India Pvt.Ltd. [reported in (2017) 52 STR 350 (Tri-Del.)]. According to the assessee, the said case was on identical facts and it was held in that decision that the place of removal is inextricably linked to the factum of sale. In the light of the decision of the Delhi Tribunal, which was rendered subsequently, what is required to be examined is as to whether the assessee was right in contending that the goods are removed to the RDCs without any sale and therefore, there can be no removal at the factory gate and the retail outlet, at which, the goods were finally sold was the place of removal. 24. Thus, in our considered view, the issue requires to be examined in depth on the factual matrix and the Adjudicating Authority shall take note of the decision of the Hon'b ..... X X X X Extracts X X X X X X X X Extracts X X X X
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