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of <h1>Tribunal rules on Cenvat Credit time-bar, remands for place of removal determination. Penalties not applicable.</h1> <h3>M/s Ultratech Cement Ltd. Versus CCE, Raipur</h3> M/s Ultratech Cement Ltd. Versus CCE, Raipur - 2014 (35) S.T.R. 751 (Tri. - Del.) , [2014] 74 VST 258 (CESTAT) Issues Involved:1. Eligibility for Cenvat Credit on GTA services for transportation from factory/depot to customer premises.2. Definition and applicability of 'place of removal.'3. Time-barred nature of Cenvat Credit demands prior to 01.04.08.4. Interpretation of relevant circulars and legal provisions.Detailed Analysis:1. Eligibility for Cenvat Credit on GTA Services:The appellants, manufacturers of cement, claimed Cenvat Credit on service tax paid for Goods Transport Agency (GTA) services used for transporting goods from the factory/depot to customer premises, asserting that their sales were on FOR (Free on Road) destination basis, making the customer's premises the 'place of removal.' The Department disallowed this credit, limiting it to transportation up to the depot, arguing that the 'place of removal' is the depot for goods sold from there.2. Definition and Applicability of 'Place of Removal':The dispute hinges on whether the customer's premises can be considered the 'place of removal' under Rule 2(l) of the Cenvat Credit Rules, 2004. The appellants relied on the Board's Circular No. 97/6/07-ST dated 23.08.07 and judgments from the Tribunal and High Courts, which supported their claim that the customer's premises could be the 'place of removal' if sales were on FOR destination basis. The Department countered that for specific duty rates or value determined under Section 4A, the factory gate should be the 'place of removal.'3. Time-Barred Nature of Cenvat Credit Demands Prior to 01.04.08:For the period before 01.04.08, the appellants argued that the demand was time-barred due to conflicting judicial decisions on the issue, invoking the Supreme Court's judgment in Continental Foundation Joint Venture Vs. CCE, which held that extended limitation cannot be invoked in cases of interpretative disputes. The Tribunal agreed, setting aside the demand for this period as time-barred.4. Interpretation of Relevant Circulars and Legal Provisions:The Tribunal examined various circulars and legal provisions, including the Board's Circular No. 137/3/06-EX-4 dated 02.02.06, which clarified that the 'place of removal' could be the customer's premises for FOR sales. However, the Tribunal noted that this interpretation conflicts with the principle of value-added tax, where the net duty liability should not vary significantly with the location of the 'place of removal.'Conclusion:The Tribunal concluded that for the period before 01.04.08, the Cenvat Credit demand is time-barred. For the period after 01.04.08, the Tribunal remanded the cases for de-novo adjudication, directing the Commissioners to consider whether the sales were on FOR destination basis and to determine the 'place of removal' accordingly, taking into account the Tribunal's observations and relevant legal provisions. Penalties under Section 11AC were deemed inapplicable due to the interpretative nature of the dispute.
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