Cenvat credit may be used to pay service tax on GTA service under Rule 3(4), following binding Tribunal precedent.

Rule 3(4) of the Cenvat Credit Rules, 2004 was applied to permit a manufacturer to use accumulated Cenvat credit for payment of service tax on GTA service treated as an output service. The Tribunal followed its earlier precedent and rejected the contrary view in the impugned orders as unsustainable. The operative effect was that utilisation of Cenvat credit for payment of service tax on GTA service was held permissible, and the assessee succeeded on that issue.

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Issues: Whether Cenvat credit could be utilised by a manufacturer for payment of service tax on GTA service under rule 3(4) of the Cenvat Credit Rules, 2004.

Analysis: The Tribunal followed its earlier decision that rule 3(4) permits utilisation of Cenvat credit for payment of service tax on an output service, and treated GTA service as falling within that framework. The contrary view taken in the impugned orders was held to be unsustainable in light of the binding Tribunal precedent.

Conclusion: Utilisation of Cenvat credit for payment of service tax on GTA service was held to be permissible, and the assessee succeeded on the issue.

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