Outward freight as input service supports CENVAT credit for pre-1.4.2008 customer deliveries.

CENVAT credit was admissible on service tax paid for outward freight used to transport final goods from the factory to customers' premises for the period before 1.4.2008, because such transportation fell within the scope of "input service" under the CENVAT Credit Rules, 2004. Applying the cited precedent on identical facts, the Tribunal held that the denial of credit and the consequential demand could not be sustained. The impugned order was therefore set aside and relief was granted to the assessee.

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Issues: Whether CENVAT credit is admissible on service tax paid on outward freight for transportation of final goods from the factory to the customer's premises for the relevant period.

Analysis: The dispute concerned the eligibility of credit on outward transportation as an input service under the CENVAT Credit Rules, 2004. The Tribunal noted that the material facts were identical to those considered in the cited precedent, which held that outward transportation for the period prior to 1.4.2008 falls within the scope of input service. On that basis, the denial of credit and the consequential demand could not be sustained.

Conclusion: The credit was held to be admissible and the denial of CENVAT credit was set aside in favour of the assessee.

Final Conclusion: The impugned order was overturned and the appeal succeeded with consequential relief.

Ratio Decidendi: For the period prior to 1.4.2008, outward freight used for clearance of final goods to customers can qualify as an input service for CENVAT credit purposes.

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