Input service includes outward transportation from the place of removal, allowing Cenvat credit on Goods Transport Agency service.

Cenvat credit was held admissible on service tax paid for outward transportation of goods from the factory to the customer's place because "input service" was construed in relation to business requirements and not confined to the factory or depot. Outward transportation of final products from the place of removal was treated as an input service under Rule 2(l)(ii) of the CENVAT Credit Rules, 2004, so credit on Goods Transport Agency service was allowed and the disallowance was set aside.

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Issues: Whether Cenvat credit was admissible on service tax paid on transportation of goods from the factory to the customer's place.

Analysis: The appeal concerned disallowance of Cenvat credit on outward transportation service. The controlling principle applied was that the expression "input service" must be construed in relation to the requirements of business and not restricted only up to the factory or depot. Outward transportation of final products from the place of removal was treated as an input service for purposes of Rule 2(l)(ii) of the CENVAT Credit Rules, 2004.

Conclusion: The appellant was entitled to Cenvat credit on the service tax paid on Goods Transport Agency Service. The impugned order was set aside and the appeal was allowed with consequential relief.

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