TaxTMI Login
Just a moment...
Press 'Enter' to add multiple search terms. Rules for Better Search
of 
of 
No Folders have been created
Are you sure you want to delete "My most important" ?
NOTE:
of of 
All Case Laws
of of All Case Laws
Note
Bookmark
Share
Don't have an account? Register Here
of <h1>Transportation of Finished Goods Not an Input Service for Cenvat Credit</h1> The Appellate Tribunal CESTAT, Chennai, held that the transportation of finished goods to the buyer's premises did not qualify as an 'input service' under ... Credit is not allowed on outward transportation of their final products from factory to buyer’s premises, on the ground that such transportation did not constitute “input service” as defined u/r 2 of CCR – considering the view taken by Division Bench at Chennai in case of India Japan Lighting (P) Ltd, assessee is directed to pre-deposit the duty amount within 4 weeks - at this stage requests for an extended period of 8 weeks, is not acceptable as not supported by any plea of financial hardships Issues: Denial of Cenvat credit on outward transportation as input service; Applicability of circular on credit of service tax; Conflict of views on substantive issue; Reference to Larger Bench; Pre-deposit waiver request.In this judgment by the Appellate Tribunal CESTAT, Chennai, the issue revolves around the denial of Cenvat credit on outward transportation of final products from the factory to the buyer's premises. The lower authorities had rejected the credit, stating that such transportation did not qualify as an 'input service' under the Cenvat Credit Rules, 2004. The appellant relied on a Board circular from August '07, clarifying that credit of service tax on transportation to the place of sale of excisable goods would be allowed if the sale and transfer of property occurred at that place. However, the circular was not retroactive, and the appellant had to establish that the sale indeed took place at the buyer's premises to benefit from it.Furthermore, the appellant pointed out a conflict of views on the substantive issue, leading the South Zonal Bench, Bangalore, to refer the matter to a Larger Bench. The appellant sought waiver of pre-deposit citing a stay order in a previous case. The Tribunal, after considering the submissions, noted a prior decision by a Division Bench in the India Japan Lighting case, which held that transportation of finished goods to the buyer's premises did not qualify as an 'input service' under the Cenvat Credit Rules. The Tribunal indicated that if this decision had been considered earlier, there might not have been a conflicting view.As a result, the Tribunal directed the appellant to pre-deposit the duty amount within a specified period and report compliance. The appellant's request for an extended period was denied due to the lack of financial hardship justification. Compliance with the pre-deposit would lead to a waiver and stay of recovery concerning the penalty amount. The judgment highlights the importance of establishing the location of sale and transfer of property to claim Cenvat credit on transportation and the significance of prior decisions in resolving conflicts of views within the Tribunal.
TaxTMI 
TaxTMI 
