CENVAT credit on CHA services for exports upheld as place of removal extends to the customs stage.

CENVAT credit on CHA services used for export of excisable goods was treated as admissible because export goods are not sold merely on clearance from the factory, and the export process continues until customs documentation is presented. Rule 2(t) of the CENVAT Credit Rules, 2004 was read with section 4(3)(c) of the Central Excise Act, 1944 to support a wider understanding of "place of removal" in the export context, extending beyond the factory gate up to the customs stage. On that basis, the credit was not denied as unrelated to removal, and the department's appeal was dismissed.

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Issues: Whether CENVAT credit was admissible on CHA service availed for export of excisable goods, and whether the place of removal in the case of export goods extended up to the customs stage so as to support the assessee's claim.

Analysis: Rule 2(t) of the CENVAT Credit Rules, 2004 adopts the meaning of expressions defined in the Central Excise Act where the Rules themselves do not provide a separate definition. Section 4(3)(c) of the Central Excise Act, 1944 defines "place of removal" with reference to the premises from which excisable goods are to be sold after clearance. For export goods, the sale is not complete merely on clearance from the factory, and the goods remain under the export process until the export documents are presented to the customs authorities. In that setting, the services used for export, including CHA service, are sufficiently connected with the export transaction and the credit cannot be denied on the footing that the factory gate was the only place of removal.

Conclusion: CENVAT credit on CHA service used for export of excisable goods was held admissible, and the department's appeal was dismissed.

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