2014 (1) TMI 207 - AT - Service Tax

Tribunal allows Cenvat Credit on export-related services

CCE. & ST. -Vapi Versus M/s. Tufropes Pvt. Ltd.

The Tribunal upheld the admissibility of Cenvat Credit on CHA services, courier services, and air travel charges for the export of goods, based on ... Availment of CENVAT Credit - Whether Cenvat Credit availed by the appellant with respect to CHA services for export of goods, courier services and air travel services availed in connection with the export of goods and business is admissible or not - Held that:- nature of services used in both cases are though different. In the group of cases decided, question was with respect to service tax paid on GTA service on outward transportation of goods - courier service utilised by the manufacturer for transportation of goods from factory and also bringing inputs into the factory. Such service would certainly be covered within the expression: any service used by the manufacturer directly or indirectly in or in relation to the manufacture of final products and clearance of final products from the place of removal: used in Rule 2(l) - Following decision of Commissioner of Central Excise vs. M/s. Ambalal Sarabhai Enterprises Ltd. [2014 (1) TMI 118 - GUJARAT HIGH COURT] - Decided against Revenue. Issues: Admissibility of Cenvat Credit on CHA services for export of goods, courier services, and air travel services.Analysis:1. Admissibility of Cenvat Credit on CHA Services: The issue revolved around whether Cenvat Credit availed by the appellant for CHA services related to the export of goods was permissible. The Commissioner (Appeals) deemed these services as admissible input services under Rule 2(l) of the Cenvat Credit Rules, 2004. The Revenue challenged this decision citing precedents like Solaris Chemtech and Maruti Suzuki Ltd. The Tribunal referred to the case of Commissioner of Central Excise and Customs vs. Mundra Port & Special Economic Zone Ltd., where it was established that the credit for service tax on CHA services was available to the respondent due to the finality of the previous decision. The Tribunal upheld the admissibility of Cenvat Credit on CHA services based on the principle of maintaining consistency in decisions.2. Admissibility of Cenvat Credit on Courier Services: The judgment also addressed the admissibility of Cenvat Credit on courier services. Citing the case of Commissioner of Central Excise vs. M/s. Ambalal Sarabhai Enterprises Ltd., the High Court held that courier services fell within the expansive definition of 'input service' under Rule 2(l) of the Cenvat Credit Rules, 2004. The Court emphasized that the definition encompassed services used directly or indirectly in relation to the manufacture and clearance of final products. The judgment confirmed that outward transportation services, including courier services, were integral to the manufacturing process and thus eligible for Cenvat Credit.3. Conclusion: The Tribunal rejected the Revenue's appeal and disposed of the respondent's cross objections accordingly. The decision was based on the legal precedents and interpretations provided by the High Courts in similar cases, affirming the admissibility of Cenvat Credit on CHA services, courier services, and air travel charges in connection with the export of goods. The judgment underscored the importance of consistency in decisions and the broad interpretation of 'input services' under the Cenvat Credit Rules, 2004.