2012 (6) TMI 98 - AT - Central Excise

Tribunal Upholds CENVAT Credit for GTA Services

The Tribunal upheld the respondent assessee's availment of CENVAT Credit on service tax paid on GTA services, following the High Court's decision in a ... CENVAT credit of service tax on goods transport agency services - Definition of input service under the CENVAT Credit Rules, 2004 - Availment of credit under Rule 26 of the CENVAT Credit Rules - Judicial precedent: High Court of Karnataka upholding Tribunal Larger Bench on GTA creditCENVAT credit of service tax on goods transport agency services - Definition of input service under the CENVAT Credit Rules, 2004 - Availment of credit under Rule 26 of the CENVAT Credit Rules - Revenue's appeals challenging denial of CENVAT credit of service tax paid on GTA services by the assessee were liable to be rejected. - HELD THAT: - The Tribunal examined whether the respondent-assessee, as recipient of GTA services, could avail CENVAT credit of the service tax paid on those services. The Bench relied on the decision of the High Court of Karnataka in CCE Bangalore v. ABB Limited, wherein paras 31 and 32 upheld the Larger Bench view that, having regard to the definition of input service and the provisions of Rule 26 regarding availment of credit, an assessee is entitled to take CENVAT credit of service tax paid on GTA services. Following that authoritative ruling, the Tribunal accepted that the Larger Bench's construction was correct and applied it to the present appeals for the periods in question, leading to rejection of the Revenue's challenge. [Paras 5, 6]Revenue's appeals are rejected and the impugned orders upholding availment of CENVAT credit on GTA service tax are affirmed.Final Conclusion: Following the High Court of Karnataka's decision upholding the Tribunal's Larger Bench view, the Tribunal rejects the Revenue's appeals and upholds the orders allowing CENVAT credit of service tax paid on GTA services for the stated periods. Issues:- Availment of CENVAT Credit on service tax paid on GTA services by the respondent assessee.Analysis:The appeals were filed by the Revenue against Order-in-Appeal No. RKA/95-96/SRT-I/2010, raising the issue of availment of CENVAT Credit by the respondent assessee on service tax paid on GTA services. The period in question was from January 2005 to 30.09.07 and October 2005 to 30.09.06. The Tribunal considered the judgment of the Hon'ble High Court of Karnataka in the case of CCE Bangalore Vs. ABB Limited, where it was concluded that the appellant could avail the CENVAT Credit of Service Tax paid on GTA services. The Tribunal, following the High Court judgment, upheld the impugned orders and rejected the Revenue's appeals.This judgment clarifies the issue of availment of CENVAT Credit on service tax paid on GTA services by the respondent assessee. The Tribunal relied on the decision of the Hon'ble High Court of Karnataka in the case of CCE Bangalore Vs. ABB Limited, which established that the appellant could indeed avail the CENVAT Credit of Service Tax paid on GTA services. The Tribunal's decision was based on a thorough analysis of the law and the provisions of Rule 26 regarding the availment of CENVAT Credit and the definition of input service as per the CENVAT Credit Rules, 2004. By following the High Court judgment, the Tribunal rejected the Revenue's appeals and upheld the impugned orders.In conclusion, the Tribunal's judgment provides clarity on the issue of availment of CENVAT Credit on service tax paid on GTA services by the respondent assessee. By aligning with the decision of the Hon'ble High Court of Karnataka in the case of CCE Bangalore Vs. ABB Limited, the Tribunal confirmed that the appellant was entitled to avail the CENVAT Credit of Service Tax paid on GTA services. This decision serves as a precedent for similar cases involving the availment of CENVAT Credit on service tax paid on GTA services by recipients of such services.