2019 (6) TMI 377 - AT - Central Excise

Tribunal Upholds Ultratech Cement Interpretation on Cenvat Credit for GTA Services

The Tribunal dismissed the appeals, aligning with the Ultratech Cement judgment's interpretation of the 'place of removal' for availing Cenvat Credit on ... CENVAT Credit - input services - Goods Transport Agency service used for outward transportation of goods - place of removal - sale of Cement on FOR basis - HELD THAT:- Hon’ble Apex Court in the case of COMMISSIONER OF CENTRAL EXCISE SERVICE TAX VERSUS ULTRA TECH CEMENT LTD. [2018 (2) TMI 117 - SUPREME COURT] held that Cenvat Credit on goods transport agency service availed for transport of goods from place of removal to buyer’s premises was not admissible to the respondent. The facts of the case in the present set of appeals being identical to the case of Ultratech Cement inasmuch as the credit being claimed is on the Goods Transport Agency services availed to transport cement from the factory gate to the buyer’s premises on the ground that the sale being on FOR basis, the place of removal shifts to the buyer’s premises and therefore Cenvat Credit is admissible, I am legally bound to follow the ratio of the judgment of the Hon’ble Apex Court which held against the assessee that no Cenvat Credit is admissible. Credit cannot be allowed - appeal dismissed - decided against appellant. Issues:Entitlement to Cenvat Credit on Goods Transport Agency services post-amendment of Rule 2(l) of CCR, 2004; Interpretation of 'place of removal' in the context of availing Cenvat Credit.Analysis:The case involved the appellants, cement manufacturers availing Cenvat Credit under CCR, 2004, for outward transportation of goods. The amendment to Rule 2(l) from 01.03.2008 restricted Cenvat Credit for transportation up to the 'place of removal.' The dispute arose regarding the definition of 'place of removal' and its application to the buyer's premises in the context of the sale being on FOR basis.The appellant contended that as per their sales agreement, the buyer's premises should be considered the 'place of removal' as the sale is completed only upon delivery at the buyer's premises. They relied on the Sale of Goods Act and the judgment in Roofit Industries, emphasizing that the sale takes place at the buyer's premises. However, lower authorities rejected their claim due to lack of documentary evidence.The first appellate authority upheld the rejection based on the judgment in CCE & ST Vs Ultratech Cement, where it was held that no Cenvat Credit is admissible for transport beyond the place of removal. The departmental representative argued for rejecting the appeal based on the Ultratech Cement judgment, asserting identical facts.The Tribunal analyzed the Ultratech Cement judgment, where the Hon'ble Apex Court disallowed Cenvat Credit for transport beyond the place of removal, even when the sale was on FOR basis. The Tribunal reiterated that the place of removal is crucial for availing Cenvat Credit, as established by the Apex Court's decision and subsequent review petition dismissal.Despite the appellant's arguments and reliance on Tribunal orders, the Tribunal held that the facts of the case aligned with Ultratech Cement, affirming that no Cenvat Credit is admissible for transport beyond the place of removal. The Tribunal emphasized its legal obligation to follow the Apex Court's judgment, which was reaffirmed in the review petition, thereby rejecting the appeals.In conclusion, the Tribunal dismissed the appeals, aligning with the Ultratech Cement judgment's interpretation of the 'place of removal' for availing Cenvat Credit on Goods Transport Agency services post-amendment of Rule 2(l) of CCR, 2004.