FOR basis outward freight and binding Board circular supported CENVAT credit, with no substantial question of law arising.

CENVAT credit on service tax paid for GTA services used in outward transportation was admissible where the sale was on FOR basis, freight formed part of the price, and the seller retained ownership and risk until delivery at the customer's doorstep in accordance with the Board circular dated 23.08.2007. The HC treated the appellate authority's factual finding on these conditions as binding, since it had not been challenged before the Tribunal, and confined appellate scrutiny to substantial questions of law. It also held that a pending challenge before the Supreme Court to another High Court ruling did not itself create a substantial question of law. The appeal therefore failed.

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Issues: Whether CENVAT credit on service tax paid on GTA services used for outward transportation from the factory to the customer was available when the sale was on FOR basis and the conditions of the Board circular were satisfied, and whether any substantial question of law arose for interference.

Analysis: The appellate authority had recorded a finding of fact that the freight charges were an integral part of the price, the goods were delivered on FOR basis, and the seller retained ownership and risk till delivery at the customer's doorstep, thereby satisfying the conditions in the Board circular dated 23.08.2007. That factual finding was not challenged before the Tribunal. The Court held that its scrutiny in appeal was confined to substantial questions of law and that the factual conclusion supporting availment of CENVAT credit could not be reopened. It further held that the circular issued by the competent authority remained binding on the Department, and the pendency of a challenge in the Apex Court against another High Court decision did not create a substantial question of law in the present case.

Conclusion: CENVAT credit was held to be admissible and no substantial question of law arose; the appeal failed.

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