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TMI Blog2023 (11) TMI 826X X X X Extracts X X X X X X X X Extracts X X X X ..... ondent ORDER ORDER : Per Ms. SULEKHA BEEVI C.S. 1. Brief facts are that the appellant is engaged in manufacturing cement and is registered with the Service Tax Commissionerate under Goods Transport Agency Services. The appellant availed CENVAT credit of Service Tax paid on freight charges incurred for outward transportation of their finished products from the factory to the place of dealers and buyers. According to department, the said credit is not eligible as the activity of outward transportation from the place of removal is not covered under the definition of input service as under 2 (l) of CENVAT Credit Rules 2004. Show Cause Notice dated 3/3/2009 was issued for the period January 2007 to February 2008 proposing to disallow the credit and to recover the same along with interest and for imposing penalty under Rule 15 (3) of CENVAT Credit Rules 2004. After due process of law, the original authority confirmed the demand, interest and imposed penalty. On appeal, the Commissioner (Appeals) upheld the same. Hence this appeal. 2. The learned consultant Shri R. Parthasarathy appeared and argued for the appellant. It is pointed out by the learned consultant that with ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nd clearance of final products upto the place of removal, and includes services used in relation to setting up, modernization, renovation or repairs of a factory, premises of provider of output service or an office relating to such factory or premises, advertisement or sales promotion, market research, storage upto the place of removal, procurement of inputs, activities relating to business, such as accounting, auditing, financing, recruitment and quality control, coaching and training, computer networking, credit rating, share registry, and security, inward transportation of inputs or capital goods and outward transportation upto the place of removal 8. From the above definition, it can be seen that prior to 1.4.2008, in sub- clause (ii) any service used by the manufacturer whether directly or indirectly, in or in relation to the manufacture of final products and clearance of final products from the place of removal, will fall within the definition of input service. 9. After 1.4.2008, the definition has been amended so that any service used for clearance of final products upto the place of removal will fall within the definition of input ser ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t transportation charges were included in the phrase clearance from the place of removal upto the date of the said substitution and it cannot be included within the phrase activities relating to business . (Emphasis supplied) 12. After appreciating the facts and evidences placed before us, we find that the decision of the Hon'ble Supreme Court is squarely applicable to the facts of this case. Moreover, the Hon'ble jurisdictional High Court in the case of M/s. Bata India Ltd. Vs. Commissioner of Customs Central Excise, Chennai III 2019 (24) GSTL 326 (Mad.) had occasion to consider the very same issue as to whether credit is eligible on the outward transportation of goods upto the customer s premises prior to the period 1.4.2008. The Hon'ble High Court applied the principle laid down in the case of M/s. Vasavadatta Cements Ltd. (supra) and The Andhra Sugars Ltd. 9supra) and held that the credit is eligible. The relevant portion of the order is reproduced as under:- 19. 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 v. Vasavadatta Cemen ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... decision in the case of Ultra Tech Cement Ltd., and negatived the stand taken by the assessee. 21. It has to be noted that for the period prior to 1-4-2008, the Hon ble Supreme Court, in the case of Vasavadatta Cements Ltd., held that the tax paid on the transportation of final product from the place of removal upto the first point, whether it is the depot or the customer, has to be allowed and we find that the issue addressed by the Hon ble Supreme Court in the decision in the case of Ultra Tech Cement Ltd., pertains to the first limb of the definition under Rule 2(1) of the CCR. In other words, the issue involved in that decision was regarding availment of Cenvat credit on goods transport agency service availed for transport of goods from the place of removal to buyer s premises. In the case of Ultra Tech Cement Ltd., the Cenvat credit on tax paid upto the customer s premises was disallowed, as it was found that the factory gate is to be determined as the place of removal . Therefore, the larger question would be as to whether the assessee would have been non-suited based on the decision in the case of Ultra Tech Cement Ltd. In our considered view, the assessee should not ..... X X X X Extracts X X X X X X X X Extracts X X X X
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