CENVAT credit on outward freight turns on the place of removal and documentary verification for FOR sales.

CENVAT credit on service tax paid for outward freight depends on identifying the place of removal. For FOR clearances, the buyer's premises may qualify as the place of removal, but that conclusion must be supported by agreements, invoices and related records. The matter was remanded for fresh verification of the documents and determination of whether freight up to the place of removal formed part of the assessable value. Credit eligibility was left to follow if the buyer's premises is established as the place of removal.

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Issues: Whether CENVAT credit of service tax paid on outward transportation of finished goods is admissible, and whether the place of removal must be ascertained for that purpose.

Analysis: Admissibility of credit on freight for outward transportation depends on identifying the place of removal. Where the clearances are under a FOR basis, the buyer's premises may constitute the place of removal, but the supporting agreements, invoices and other documents must be verified. The matter therefore required fresh examination by the adjudicating authority to determine whether freight up to the place of removal formed part of the assessable value and whether the conditions for credit were satisfied.

Conclusion: The issue was not finally decided on merits. The impugned orders were set aside and the matter was remanded for verification of documents and determination of the place of removal, with eligibility for credit to follow if the buyer's premises is found to be the place of removal.

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