Place of removal test governs CENVAT credit on outward GTA freight, requiring contract-based factual verification before eligibility is ined.

CENVAT credit on GTA services for outward transportation depends on the place of removal, which must be determined by when and where the sale is completed and property in the goods passes under the contract and the Sale of Goods Act, 1930. The applicable test is contractual and factual, not a mechanical reliance on advance payment, freight, insurance, or risk allocation alone. Because the dealer agreements were inconsistent and some were silent on delivery terms, the question required factual verification. The matter was remanded to the original authority to determine the place of removal and the assessee's credit eligibility in line with the circulars and the dealer agreements, after observing natural justice.

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Issues: Whether the assessee was entitled to CENVAT credit on GTA services used for transportation of goods to dealers' premises, which depended on the correct determination of the place of removal.

Analysis: The governing circulars state that eligibility to credit on outward transportation turns on the place of removal, which in turn depends on when and where the sale is completed and property in the goods passes to the buyer. The relevant test is to be applied with reference to the terms of the contract and the Sale of Goods Act, 1930, and not merely on the basis of advance payment, freight charges, insurance, or risk-bearing. On the facts, the agreements were not uniform and some required delivery at dealers' premises while others were silent, making factual verification necessary.

Conclusion: The issue was not finally determined on merits and was sent back for reconsideration and factual verification; the assessee obtained only a remand.

Final Conclusion: The matter was remanded to the original adjudicating authorities to determine the place of removal and the assessee's eligibility to credit in accordance with the circular and the dealer agreements, after following the principles of natural justice.

Ratio Decidendi: For outward transportation credit, the decisive test is the place where sale is completed and property in the goods passes under the sale contract and the Sale of Goods Act, 1930.

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