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TMI Blog2023 (12) TMI 1332X X X X Extracts X X X X X X X X Extracts X X X X ..... ch the reference has been made, but would have implication on all appeals pending before other Benches of the Tribunal involving same issue and are awaiting the outcome of the present reference. The decision in M/S KARAIKAL PORT PVT LTD. VERSUS COMMISSIONER OF CENTRAL EXCISE, PUDUCHERRY [ 2015 (1) TMI 87 - CESTAT CHENNAI] is neither relevant nor applicable to the present circumstances. In that case, the applicant sought permission to be impleaded as a necessary party in the appeal filed by the Port Department, Karnataka on the ground that on confirmation of the service tax demand against the Port Department a notice was issued for recovery of the confirmed service tax. Consequently, the applicant approached the Tribunal to allow them to intervene in the appeal. The application was filed under Order 1 Rule 8A of the First Schedule to the Code of Civil Procedure. In a case where clearances of goods are against FOR contract basis, the authority needs to ascertain the place of removal by applying the judgments of the Supreme Court in COMMISSIONER CENTRAL EXCISE, MUMBAI-III VERSUS M/S. EMCO LTD. [ 2015 (8) TMI 200 - SUPREME COURT] and COMMISSIONER, CUSTOMS AND CENTRAL EXCISE, AURANGABAD ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... val in case of sale on FOR buyer s premises basis is the buyer s premises and that CENVAT credit on GTA services is available on outward transportation of goods from factory to the buyer s premises. 17. As we do not agree with the aforesaid decisions of CESTAT, Chennai we find this is a fit case to be referred to Larger Bench to decide the following question: In the light of the judgment of the Hon ble Apex Court in the case of Ultratech Cement Limited [2018 (9) GSTL 337 (SC)] and the Ispat Industries Limited [2015 (324) ELT 670 (SC)] should CENVAT credit on GTA services for outward transportation of goods from the factory to the buyer s premises be denied in cases where the goods are sold on FOR (buyer s premises) basis or should such matters be remanded to the lower authorities for determining what is the place of removal? 18. Accordingly, we direct the Registry to place this file before Hon ble President to consider constitution of a Larger Bench to decide the above question. 2. Consequently, the present Larger Bench has been constituted to decide the said reference. 3. After constitution of the Larger Bench, the appellant through a letter dated 23.6.2023 informed that the appel ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t Pvt. Ltd. vs. CCE, Puducherry [2016 (46) STR 695 (Tri. - Chennai)]. He further submitted that the order of the Tribunal in Kafila Hospitality Travels Pvt. Ltd. vs. CST, Delhi [2021 (47) GSTL 140 (Tri. - LB)] is distinguishable as the Larger Bench of the Tribunal had not considered the earlier judgment in Karaikal Port. Learned authorised representative also submitted that when the intervener has no locus standi to approach this Tribunal as an aggrieved party, it should not be allowed to intervene. This is only admissible in civil proceedings before the Courts under Code of Civil Procedure. Further, it has been submitted that the intervener may take a different stand than that of the appellant/assessee before this Tribunal to protect its own interest in the guise of intervener and so it should not be heard, as this would set a bad precedent. It has also been submitted that if the Larger Bench decision is against them and it would affect their case, they can take appropriate statutory remedy under the Central Excise law. 7. We do not find merit in the contention of the learned authorized representative for the department in as much as the Larger Bench has been constituted to addres ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... red to the Larger Bench may be involved in the appeal cannot be a ground to reject the intervention application. The Division Benches of the Tribunal would be bound by the decision of the Larger Bench on these issues. This will, therefore, not be a good reason to deny an opportunity to the applicants to make submissions before the Larger Bench. 18. The second objection raised by the Learned Authorized Representatives of the Department is that the Customs, Excise and Service Tax Appellate Tribunal (Procedure) Rules, 1982 do not provide for moving an intervention application. As noticed above, any decision taken by the Larger Bench on the issues referred to it would bind the Division Benches when the appeals filed by the applicants are heard. Rule 41 of the aforesaid 1982 Rules confers power on the Tribunal to make such orders or such direction as may be necessary to secure the ends of justice. Justice, in the present case, requires that the applicants be heard, otherwise they would have a complaint that the issues involved in their appeals have been decided by the Larger Bench of the Tribunal without hearing them. 19. The Larger Bench decision of the Tribunal in Subhash Projects Mar ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... kar Engines India Ltd [2018 (10) TMI 1642 CESTAT-Ahmedabad] (ii) M/s. Balaji Multiflex (P) Ltd. v. CCE [2018 (10) TMI 530 (CESTAT-Ahmedabad)] (iii) CCE v. M/s. A. K. Automatics [Final Order no.63477-63481/2018 dated 20.11.2018] ***** 14. In the circumstances, all these appeals relating to the issue of eligibility of Cenvat credit in respect of Outward Transportation Services upto buyer s premises are remanded to the adjudicating authority who will reconsider the matter afresh keeping the judgments of M/s. Ultra Tech Cements Ltd., M/s. Roofit Industries Ltd., and Board s Circular 08.06.2018. The impugned orders are set aside. Appeals are allowed by way of remand. 12. The learned counsel for the intervener submitted that rule 2(l) of CENVAT Credit Rules, 2004 defines input service which includes service of outward transportation up to the place of removal as an eligible input service. Place of removal was not defined under CENVAT Credit Rules, 2004 until 11.7.2014. The term place of removal defined under Rule 2(qa) of CENVAT Credit Rules, 2004 inter alia includes .. a depot premises of a consignment agent or any other place or premises from where the excisable goods are to be sold af ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ifferent factual circumstances. He further submitted that subsequent to the decision in Ultratech Cements, various High Courts have considered the applicability of the same. In support, he referred to the following decisions: (i) Bharat Fritz Werner Ltd. vs. CCT, Bangalore [2022 (66) G.S.T.L. 434 (Kar.)] (ii) Commr. vs. Mangalam Cement Ltd. [2019 (24) GSTL 545 (Raj.)] (iii) Commr. vs. ARL Indratech Ltd. [2019 (369) ELT 351 (Raj.)] (iv) M/s. Mahle Engine Components vs. UOI [2020 (13) GSTL-OL-173 (MP)] 14. He further submitted that the reference in question is not whether the credit is available or otherwise, but it is only whether the matter needs to be remanded to the adjudicating authority to consider the 2018 Circular and afford an opportunity to the assessee to place submissions in this regard. Therefore, he submits that the matter may be remanded to the adjudicating authority. 15. The learned authorized representative for the department submitted that the issue for determination in the present case pertains to place of removal of goods, more particularly under rule 2(l) of CENVAT Credit Rules, 2004 and whether CENVAT Credit is available. It is his submission that place of remov ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on the final product. CENVAT credit was proposed to be denied, inter alia, on the service tax paid on outward transportation services of their manufactured goods from their factory to the dealers/customers premises situated at various places. 18. Before analyzing the issue, it is relevant to reproduce the amended definition of input service under CENVAT Credit Rules, 2004, effective from 01.3.2008 which is as follows: (l) input service means any service, - used by a provider of output service for providing an output service; or (i) used by a manufacturer, whether directly or indirectly, in or in relation to the manufacture of final products and clearance of final products upto the place of removal, and includes services used in relation to modernisation, 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, accounting, auditing, financing, recruitment and quality control, coaching and training, computer networking, credit rating, share registry, security, business exhibition, legal services, inward tran ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... envat Credit is permissible in respect of input service and the Circular relates to the unamended regime. Therefore, it cannot be applied after amendment in the definition of input service which brought about a total change. Now, the definition of place of removal and the conditions which are to be satisfied have to be in the context of upto the place of removal. It is this amendment which has made the entire difference. That aspect is not dealt with in the said Board s circular, nor it could be. 12. Secondly, if such a circular is made applicable even in respect of post amendment cases, it would be violative of Rule 2(l) of Rules, 2004 and such a situation cannot be countenanced. 13. The upshot of the aforesaid discussion would be to hold that Cenvat Credit on goods transport agency service availed for transport of goods from place of removal to buyer s premises was not admissible to the respondent. Accordingly, this appeal is allowed, judgment of the High Court is set aside and the Order-in-Original dated August 22, 2011 of the Assessing Officer is restored. 20. The facts of the aforesaid case are that the assessee was availing CENVAT credit facility on GTA service under CENVAT C ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... (S.C.), CCE v. Ispat Industries Ltd. - 2015 (324) E.L.T. 670 (S.C.), CCE, Mumbai-III v. Emco Ltd. - 2015 (322) E.L.T. 394 (S.C.) and CCE ST v. Ultra Tech Cement Ltd. dated 1-2-2018 in Civil Appeal No. 11261 of 2016 [2018 (9) G.S.T.L. 337 (S.C.)]. In this regard, references have been received from field formations seeking clarification on implementation of aforesaid circulars of the Board in view of judgments of Hon ble Supreme Court. 2. In order to bring clarity on the issue it has been decided that Circular No. 988/12/2014-CX., dated 20-10-2014 shall stand rescinded from the date of issue of this circular. Further, clause (c) of para 8.1 and para 8.2 of the Circular No. 97/8/2007-CX., dated 23-8-2007 are also omitted from the date of issue of this circular. 3. General Principle : As regards determination of place of removal , in general the principle laid by Hon ble Supreme Court in the case of CCE v. Ispat Industries Ltd. - 2015 (324) E.L.T. 670 (S.C.) may be applied. Apex Court, in this case has upheld the principle laid down in M/s. Escorts JCB (supra) to the extent that place of removal is required to be determined with reference to point of sale with the condition that place ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ese cases otherwise also the buyer is located outside India. 5. CENVAT Credit on GTA Services etc. : The other issue decided by Hon ble Supreme Court in relation to place of removal is in case of CCE ST v. Ultra Tech Cement Ltd., dated 1-2-2018 in Civil Appeal No. 11261 of 2016 on the issue of CENVAT Credit on Goods Transport Agency Service availed for transport of goods from the place of removal to the buyer s premises. The Apex Court has allowed the appeal filed by the Revenue and held that CENVAT Credit on Goods Transport Agency service availed for transport of goods from the place of removal to buyer s premises was not admissible for the relevant period. The Apex Court has observed that after amendment of in the definition of input service under Rule 2(l) of the CENVAT Credit Rules, 2004, effective from 1-3-2008, the service is treated as input service only up to the place of removal . 6. Facts to be verified: This circular only bring to the notice of the field the various judgments of Hon ble Supreme Court which may be referred for further guidance in individual cases based on facts and circumstances of each of the case. Past cases should accordingly be decided. 7 . No extende ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... vations of Courts are neither to be read as Euclid s theorems nor as provisions of the statute and that too taken out of their context. These observations must be read in the context in which they appear to have been stated. Judgments of Courts are not to be construed as statutes. To interpret words, phrases and provisions of a statute, it may become necessary for judges to embark into lengthy discussions but the discussion is meant to explain and not to define. Judges interpret statutes, they do not interpret judgments. They interpret words of statutes; their words are not to be interpreted as statutes. In London Graving Dock Co. Ltd. v. Horton (1951 AC 737 at p. 761), Lord Mac Dermot observed : The matter cannot, of course, be settled merely by treating the ipsissima vertra of Willes, J as though they were part of an Act of Parliament and applying the rules of interpretation appropriate thereto. This is not to detract from the great weight to be given to the language actually used by that most distinguished judge. 12. In Home Office v. Dorset Yacht Co. [1970 (2) All ER 294] Lord Reid said, Lord Atkin s speech is not to be treated as if it was a statute definition. It will require ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... three basic postulates (i) findings of material facts, direct and inferential. An inferential finding of facts is the inference which the Judge draws from the direct, or perceptible facts; (ii) statements of the principles of law applicable to the legal problems disclosed by the facts; and (iii) judgment based on the combined effect of the above. A decision is an authority for what it actually decides. What is of the essence in a decision is its ratio and not every observation found therein nor what logically flows from the various observations made in the judgment. The enunciation of the reason or principle on which a question before a Court has been decided is alone binding as a precedent. (See: State of Orissa v. Sudhansu Sekhar Misra and Ors. (AIR 1968 SC 647) and Union of India and Ors. v. Dhanwanti Devi and Ors. (1996 (6) SCC 44). A case is a precedent and binding for what it explicitly decides and no more. The words used by Judges in their judgments are not to be read as if they are words in Act of Parliament. In Quinn v. Leathem (1901) AC 495 (H.L.), Earl of Halsbury LC observed that every judgment must be read as applicable to the particular facts proved or assumed to be p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... evived. However, the present matter deserves to be remanded to the Tribunal to consider the question of penalty. In view of above discussion, present appeal deserves to succeed and is accordingly allowed. Impugned judgment dated 10-10-2017 passed by the Tribunal is set aside. Order dated 28-9-2015 passed by the Adjudicating Authority to the extent of disallowance of Cenvat credit on the aforementioned these aspects and interest thereon is confirmed. However, the matter is remanded back to the Tribunal for consideration of the question of penalty to decide the same after hearing both the parties in accordance with law. We make it clear that we have not expressed anything on merits on the question of penalty. Accordingly, we set aside the impugned judgment and restore the appeal(s) to the file of the High Court to its original number, for being considered afresh in accordance with law. All contentions to both the parties are left open. The appeals are disposed of accordingly. All pending applications are also disposed of. No costs. 30. The Madhya Pradesh High Court in Mahle Engine Components India also held that credit is not admissible on GTA services for removal of finished goods t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Removal . In Para 5 of the Circular, the Ministry has referred to the judgment in the case of CCE ST v. Ultra Tech Cement Ltd. [Civil Appeal No. 11261 of 2016, dated 1-2-2018] [2018 (9) G.S.T.L. 337 (S.C.)] and stated that, in that case, the Apex Court has held that Cenvat credit on GTA Service from the place of removal to the buyer s premises is not admissible. 18. In the instant cases, the place of removal is buyer s premises. Therefore, the authority in the case of Madras Cements Ltd., is applicable to the facts of this case and these appeals merit consideration. Hence, the following : ORDER (a) The questions of law framed by this Court in CEAs No. 56/2019 and 71/2019 are answered in favour of the assessee holding that the Tribunal s view is unsustainable in law; (b) CEA No. 56/2019 is allowed and impugned order vide Final Order Nos. 21960-21962/2018, dated 31-12-2018 passed in Appeal Nos. E/21756/2017-SM, E/21757/2017-SM and E/21758/2017-SM are set aside; and (c) CEA No. 71/2019 is allowed and impugned order vide Final Order No. 20224/2019, dated 27-2-2019 passed in Appeal No. E/20302/2018-SM is set aside. 32. The interpretation of the judgment of the Supreme Court by the High ..... X X X X Extracts X X X X X X X X Extracts X X X X
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