Outward transportation as input service upheld where freight from place of removal qualifies as business-related activity.

Cenvat credit on service tax paid for outward transportation of finished goods from the factory gate to the customer's premises was treated as admissible input service. The Tribunal applied the Larger Bench view that transportation from the place of removal falls within "activities relating to business" under the input service definition. It also noted that valuation issues and Cenvat credit entitlement operate independently and do not govern each other. On that basis, the credit was allowed and the Revenue's challenge to the Commissioner (Appeals) order failed.

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Issues: Whether Cenvat credit of service tax paid on outward transportation of finished goods from the factory gate to the customer's premises was admissible as input service.

Analysis: The issue was treated as settled by the Larger Bench decision holding that outward transportation from the place of removal falls within the expression "activities relating to business" in the definition of input service. The Tribunal also noted that the question of valuation and the question of Cenvat credit are independent and do not control each other.

Conclusion: The credit was held admissible and the Revenue's challenge to the Commissioner (Appeals)'s order failed.

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