2017 (5) TMI 875 - AT - Central Excise

Appellant wins appeal for Cenvat credit on input services; Tribunal recognizes eligibility.

The appellant, M/s Maral Overseas Ltd., successfully appealed against the denial of Cenvat credit for CHA services, courier services, and clearing and ... CENVAT credit - eligible input services - CHA services - courier services - clearing and forwarding agent service - Held that: - it appears that the subject services viz. CHA service, courier service and clearing and forwarding agent service are eligible input service on which the assessee appellant is entitled to take Cenvat credit - for CHA services, reliance placed in the case of Mundra Ports & Special Economic Zone Ltd. Vs. CCE, Rajkot [2008 (9) TMI 117 - CESTAT AHEMDABAD], where it was held that input service of CHA is eligible to be claimed as Cenvat credit by the assessee - in respect of Courier services, the Tribunal decided in the case of CCE & Cus, Vapi Vs. Apar Industries Ltd. [2010 (8) TMI 407 - CESTAT, AHMEDABAD] that for the service tax paid for the input service of courier, assessee is entitled to claim Cenvat credit - in respect of clearing and forwarding agent service, there is again a decision by the Tribunal in the case of Ashirvad Pipes Pvt. Ltd. Vs. CCE, Bangalore [2013 (12) TMI 1268 - CESTAT BANGALORE] whereunder C&F agent service is found to be eligible service for claiming Cenvat credit by the assessee - credit allowed - decided in favor of assessee. Issues:Claim of Cenvat credit for input services viz. CHA services, courier services, and clearing and forwarding agent service.Analysis:The appellant, M/s Maral Overseas Ltd., filed an appeal against the Order-in-Appeal denying Cenvat credit for the mentioned input services. Both sides were represented by counsels, and it was noted that Revenue had filed cross-objections. After reviewing the facts and submissions, it was concluded that the appellant was entitled to claim Cenvat credit for CHA services, courier services, and clearing and forwarding agent services.CHA Services:The Tribunal referred to a previous decision in the case of Mundra Ports & Special Economic Zone Ltd. where it was held that CHA services are eligible for Cenvat credit as they are used for providing output services and are integrally connected with other services. The Tribunal emphasized that services covered by the definition of input services are eligible for credit, citing the Commissioner's order allowing credit for similar services. Thus, the appellant was allowed credit for CHA services.Courier Services:In the case of CCE & Cus, Vapi Vs. Apar Industries Ltd., the Tribunal affirmed that courier services are part of input services used for various activities related to manufacturing and business operations. The services were found to be directly related to the manufacturing process and business activities, making them eligible for Cenvat credit. The appeal filed by Revenue was rejected based on this reasoning.Clearing and Forwarding Agent Service:Referring to the case of Ashirvad Pipes Pvt. Ltd. Vs. CCE, Bangalore, the Tribunal highlighted that the ownership transfer of goods occurs at the port of export through the Bill of Lading, making C&F agent services essential for outward transportation. The lower authorities' view that the factory gate was the place of removal of goods was overturned based on the Tribunal's decision. Consequently, the appellant was allowed to claim Cenvat credit for clearing and forwarding agent services.In conclusion, the impugned order was set aside, and the appeal was allowed, with the cross-objections also being disposed of. The judgment clarified the eligibility of the appellant to claim Cenvat credit for the specified input services based on relevant case laws and definitions of input services under the Cenvat Credit Rules, 2004.