CENVAT credit on outward transportation turns on the place of removal under FOR sales and contractual documents.

CENVAT credit on service tax paid for outward transportation depends on the correct determination of the place of removal. Where goods are sold on a FOR basis, the buyer's premises may be treated as the place of removal under the Board's circular, and purchase orders may be examined as the relevant contractual document to establish that basis. Because the authorities had not properly considered the circular and the purchase orders produced, the matter was remitted for fresh consideration of the place of removal and the resulting credit eligibility on outward transportation.

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Issues: Whether CENVAT credit on service tax paid on outward transportation of finished goods to the buyer's premises was admissible, and whether the place of removal had to be determined from the purchase orders and the Board's circular.

Analysis: The eligibility of credit on outward transportation depends on the place of removal. The Board's circular clarified that where goods are sold on FOR basis, the buyer's premises may be treated as the place of removal. Purchase orders can constitute the relevant contractual document when they show sale on FOR basis, and such orders may be relied upon to decide both the place of removal and, consequently, the credit entitlement. As the authorities had not properly examined the circular and the documents produced, the matter required fresh consideration.

Conclusion: The issue was remitted to the Original Authority for reconsideration of the place of removal and the consequent eligibility of credit on outward transportation.

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