2018 (8) TMI 945 - AT - Central Excise

Tribunal Grants Appeal, Affirms CENVAT Credit Eligibility for Transportation Services

The Tribunal allowed the appeal, granting consequential relief to the appellants, affirming the eligibility of CENVAT credit for outward transportation ... CENVAT Credit - GTA Services - transportation of finished goods from the place of removal - Held that:- CENVAT credit on the outward transportation services provided by the appellant is eligible to them - reliance placed in the case of CCE, Belgaum vs. Vasavadatta Cements Ltd. [2018 (3) TMI 993 - SUPREME COURT], where it was held that tax paid on the transportation of the final product from the place of removal upto the first point, whether it is depot or the customer, has to be allowed - credit allowed - appeal allowed - decided in favor of appellant. Issues: Availability of CENVAT credit on transportation of finished goods from the place of removal, Bar on limitation for demandAnalysis:1. The issue in this case revolves around the availability of CENVAT credit on the transportation of finished goods from the place of removal. The appellants, a company engaged in manufacturing hydraulic cylinders, availed CENVAT credit amounting to Rs. 50,19,711 during 2004-05 to 2007-08 for transportation of goods by air and road after clearance at the factory gate. The Department raised a demand, which led to this appeal.2. The appellant's counsel argued that the issue has been settled by previous judicial decisions, citing cases such as CCE vs. Vasavadatta Cements Ltd. and Commissioner vs. ABB Ltd. The counsel emphasized that services used for outward transportation of goods from the place of removal fall under the definition of 'input service' as per the CENVAT Credit Rules, 2004. Additionally, the counsel contended that the demand is time-barred since the appellants consistently disclosed the CENVAT credit in their returns without any prior objections.3. The Departmental Representative reiterated the findings of the Order-in-Original, maintaining the demand raised by the Department.4. Upon reviewing the arguments and case records, the Tribunal found that the issue had already been addressed in previous judgments cited by the appellant's counsel. Referring to the decisions of the Supreme Court and CESTAT, the Tribunal noted that the definition of 'input service' under the CENVAT Credit Rules includes services used for transportation of goods from the place of removal. The Tribunal highlighted the amendment in the Rule, emphasizing the eligibility of CENVAT credit for outward transportation services provided by the appellant.5. Consequently, the Tribunal allowed the appeal, granting consequential relief to the appellants. The operative portion of the Order was pronounced in open court on 23/07/2018, affirming the eligibility of CENVAT credit for outward transportation services in line with the established legal interpretations and precedents.