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TMI Blog2024 (11) TMI 719X X X X Extracts X X X X X X X X Extracts X X X X ..... d transportation. Recently, on the identical issue and under the same set of facts, the Hon ble Kerala High Court in the case of TRANSFORMERS AND ELECTRICALS KERALA LTD. VERSUS THE COMMISSIONER OF CENTRAL TAX AND CENTRAL EXCISE KOCHI, THE CUSTOMS, EXCISE AND SERVICE TAX APPELLATE TRIBUNAL, BANGALORE. [ 2024 (10) TMI 623 - KERALA HIGH COURT] also taken the same view and held that ' In the instant cases, however, we find that it is the admitted case that the appellant did not include the transportation costs in the assessable value of the goods for the purposes of payment of Central Excise duty. Under such circumstances, we fail to see how the appellant can claim input tax credit in respect of the transportation services availed by it for the purposes of transporting the goods from the place of removal to the buyer's premises. In our view, permitting the appellant to avail input tax credit in such circumstances would militate against the very Scheme of CENVAT credit, which is designed to avoid the cascading effect of tax and an ultimate burden on a consumer. We therefore see no reason to interfere with the order of the Tribunal impugned in these appeals.' In view of the a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he assessee is eligible for the Cenvat Credit on outward transportation. The said judgment of the Tribunal has been upheld by the Hon ble High Court of Gujarat reported at The Commissioner of Central Goods and Service Tax vs. Ultra Tech Cement Ltd 2020-TIOL-1638-HC-AHM-CX wherein, the Hon ble High of Gujarat has passed the following judgment:- 1. These Tax Appeals are filed under Section 35G of the Central Excise Act, 1944 by the Revenue and are directed against the order No.A/10373/2019 dated 25th February 2019 passed by the Customs, Excise and Service Tax Appellate Tribunal, West Zone Bench, Ahmedabad in Appeals Nos.E/11098/2015, E/10271/2015DB and E/11326/2017DB=2019-TIOL- 1420-CESTAT-AHM respectively. 2 The Revenue has proposed the following question as substantial question of law: (i) Whether in the facts and circumstances of the case, was the Tribunal right in law in allowing the appeal of the respondent to avail Cenvat credit of service tax on outward transportation for the period 2009-10 to 2013-14? 3. The short controversy, which arises in these appeals, is with regard to denial of Cenvat Credit for the period from 2009-10 to 2013-14 of service tax paid on outward transpor ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... held 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 of removal (premises) is to be referred with reference to the premises of the manufacturer. The observation of Honb le Count in para 16 in this regard is significant as reproduced below: 16. It will thus be seen where the price at which goods are ordinarily sold by the assessee is different for different places of removal, then each such price shall be deemed to be normal value thereof, Subclause (b) (iii) is very important and makes it clear that a depot, the premises of a consignment agent, or any other place or premises from where the excisable goods are to be sold after their clearance from the factory are all places of removal. What is important to note is that each of the premises is referable only the manufacturer and not to the buyer of excisable goods. The depot or the premises of the consignment agent of the manufacturer are obviously places which are referable to the manufacturer. Even the expression any other place of premises refers only to a manufacturers place or premises because su ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ds Act by applying the same to the facts of each case to determine as to when the ownership in the goods is transferred from the seller to the buyer. The charges Which are to be added have put up to the stage of the transfer of that ownership inasmuch as once the ownership in goods stands transferred to the buyer, any expenditure incurred thereafter has to be on buyer s account and cannot be a component which would be included while ascertaining the valuation of the goods manufactured by the buyer. That is the plain meaning Which has to be assigned to Section 4 read with Valuation Rules. 13. In the present case, we find that most of the orders placed Withthe respondent assessee were by the various Government authorities. One such order, I.e., order dated 2461996 placed by Kerala Water Authority is on record. On going through the terms and conditions of the said order, it becomes clear that the goods were to be delivered at the place of the buyer and it is only at that place where the acceptance of supplies was to be effected. Price of the goods was inclusive of cost of material, Central Excise duty, loading, transportation, transit risk and unloading charges, etc. Even transit dama ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ualify as Input Service . As regard reliance placed upon by the revenue on the judgment of the Apex Court, we find that the Hon ble Supreme Court was concerned only with the place of removal but did not go into the aspect of Point of sale or the FOR price destination issue. Hence the said judgment is not applicable in the facts of the present case. 6. As regards other judgments cited by rivals, though we have considered the same, but since, we have discussed above the most relevant apex court judgments, we need not to discuss each and every judgment. 7. As regard the issue raised by the appellant that the excise duty paid on the element of freight being more than the element of cenvat credit on the outward GTA, therefore, there should not be any demand. We find force in the argument of the appellant however, since we are deciding the issue on merit, the admissibility of the Cenvat Credit on outward GTA on the basis of provision under Cenvat Credit Rules itself, we need not to deal this aspect hence, the issue related to this fact left open. As regard the submission made by Ld. Counsel that they have been operating as per the guideline given in the Circular dated 22.12.2014 and 23.0 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... al N. Warrior, the learned Standing Counsel for the respondent Department. On a consideration of the rival submissions, we find that while it may be a fact that in the decision of the Supreme Court in Commissioner of Customs and Central Excise, Aurangabad v. Roofit Industries Ltd. - [2015 (319) E.L.T. 221 (SC)] that is relied upon by the learned counsel for the appellant, it was found that in circumstances where a manufacturer enters into a contract with his buyer on FOR basis, the place of removal for the purposes of payment of Central Excise duty has to be seen as the buyer's premises and not the manufacturer's factory, the upshot of the said finding was that the manufacturer, in that case, was legally obligated to include the cost of transportation of the goods from his factory to the premises of the buyer in the assessable value of the goods for the purposes of payment of Central Excise duty. May be in a factual situation similar to that, the appellant would be justified in contending that on the cost of transportation being included in the assessable value of the goods for the purposes of Central Excise duty, the amount paid to the goods transport agencies, who carried ..... X X X X Extracts X X X X X X X X Extracts X X X X
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