2021 (7) TMI 662 - AT - Central Excise

Tribunal grants Cenvat Credit on GTA services sold on FOR basis

The Tribunal allowed the appellant's appeal, determining that they were entitled to Cenvat Credit on outward Goods Transport Agency (GTA) services. The ... CENVAT Credit - input services - outward GTA services - sale of goods on FOR basis - price is inclusive of freight - HELD THAT:- The facts and documents related there to submitted by the learned Counsel shows that sale of goods is on FOR basis, the freight was paid and born in bond by the appellant. Sale price is inclusive of freight on which excise duty was charged. Similar issue decided in appellant's own case BANCO PRODUCTS INDIA LTD VERSUS C.C.E. & S.T. -VADODARA-I [2021 (3) TMI 507 - CESTAT AHMEDABAD] where it was held that the invoices clearly mentioned a condition that the sale is on FOR basis and risk upto the destination is covered. It is also not the case of the department that outward transit insurance was paid by the consignee. In this case it is clear that the sale is on FOR basis and sale invoices itself is a kind of contract and no further contract is required to ascertain that whether the sale is on FOR basis or not. Therefore, there is no dispute that sale is on FOR basis and hence credit is admissible. Appeal allowed - decided in favor of appellant. Issues Involved: Admissibility of Cenvat Credit in respect of outward GTA.Analysis:The issue in the present case revolved around the admissibility of Cenvat Credit concerning outward Goods Transport Agency (GTA). The appellant contended that in a previous case with identical facts, the Tribunal had allowed Cenvat Credit, citing judgments in related cases. The appellant argued that the issue was settled based on previous Tribunal orders. The appellant's counsel highlighted that the sale of goods was on a FOR basis, with freight being paid and included in the sale price. The Tribunal had previously allowed credit in a similar scenario, emphasizing the sale being on a FOR basis and no further contract being necessary to establish this fact.The learned Superintendent representing the Revenue reiterated the findings of the impugned orders. After considering the submissions from both sides, the Tribunal examined the documents and facts presented by the appellant's counsel. The Tribunal noted that the sale was on a FOR basis, with the sale invoices clearly indicating this condition. It was observed that the sale invoices themselves constituted a contract specifying the FOR basis, making the credit admissible. The Tribunal referenced previous judgments and circulars supporting the admissibility of credit in such cases, including decisions by the Hon'ble Supreme Court and the Gujarat High Court.In light of the above discussion and the precedent set by previous Tribunal orders and higher court judgments, the Tribunal concluded that the appellant was entitled to the Cenvat Credit on outward Transit Insurance services. Consequently, the impugned order was set aside, and the appeal was allowed, granting any consequential relief as per the law. The Tribunal emphasized the applicability of the previous order's ratio to the present case, leading to the allowance of the appeal based on established legal principles and interpretations.This detailed analysis of the judgment showcases the Tribunal's thorough consideration of the legal arguments, factual evidence, and precedents to arrive at a reasoned decision regarding the admissibility of Cenvat Credit in the context of outward GTA transactions.