2017 (1) TMI 189 - AT - Central Excise

Tribunal overturns rejection of CENVAT credit on GTA services, emphasizes legal precedents

M/s. Applicomp India Ltd. Versus The Commissioner of Central Excise, Customs and Service Tax Bangalore

The Tribunal allowed the appeal, setting aside the rejection of CENVAT credit on GTA services and remanding the matter for a fresh decision. The ... CENVAT credit - demand of credit with interest and penalty - demand on the ground that the credit availed on GTA services received was irregular - Held that: - the appellant have all the documents in the form of invoices raised on the customers by the appellant during the relevant period and also lorry receipts raised by the transporters on the appellant on the basis of which service tax was paid and credit availed during the relevant period but the authorities below have not considered these documents to arrive at a finding as to when the ownership in the goods has taken place - I allow the appeal of the appellant by setting aside the impugned order and remanding the matter to the original adjudicating authority for fresh decision after considering the documents filed by the appellant - appeal allowed by way of remand. Issues:Appeal against rejection of CENVAT credit on GTA services.Analysis:The appellant, engaged in manufacturing excisable goods, availed CENVAT credit on service tax paid for transporting goods to buyers' premises. The dispute arose when show-cause notices were issued proposing to demand irregularly availed CENVAT credit on GTA services. The Additional Commissioner confirmed the demand, which was upheld by the Commissioner (A). The appellant contended that the impugned order ignored relevant circulars and judgments, arguing that transportation costs were integral to the sale consideration. Citing various decisions, the appellant asserted that the ownership of goods remained with them until delivery. The appellant highlighted circulars, court decisions, and Tribunal judgments supporting their position. The appellant also emphasized having relevant documents to establish ownership transfer timing, referencing favorable Tribunal decisions in their previous cases. The AR supported the impugned order's findings.The Tribunal, after considering submissions, relevant judgments, and the appellant's documents, allowed the appeal by setting aside the impugned order. The matter was remanded to the original adjudicating authority for a fresh decision, instructing them to consider all relevant documents and previous Tribunal decisions favoring the appellant. The Tribunal emphasized that the law as declared in previous decisions should guide the adjudicating authority's fresh decision. The appeal was allowed by way of remand, overturning the rejection of CENVAT credit on GTA services and directing a reevaluation based on the appellant's submissions and supporting documents.