Cenvat credit for outward GTA transport allowed where FOR destination terms kept ownership and transit risk with the seller.

Cenvat credit was available on service tax paid for GTA services used to transport final products from the factory to the buyer's premises where the supply was on a FOR destination basis, ownership remained with the seller till delivery, the seller bore transit risk, and freight formed part of the delivered price. The purchase order showed transport charges were not separately recoverable and the prices were stated as FOR Pune. As the Revenue did not show that the actual transaction departed from these conditions, the supplier satisfied the circular requirements and was entitled to the credit.

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Issues: Whether Cenvat credit of service tax paid on GTA service used for outward transportation of final products from the factory to the buyer's premises was admissible.

Analysis: The Board's circular prescribed that credit would be available only if the ownership in the goods remained with the seller till delivery at the buyer's doorstep, the seller bore the risk of loss or damage in transit, and freight formed part of the delivered price. The goods were supplied on a FOR destination basis, the purchase order showed that transport charges were not separately recoverable and that the prices were FOR Pune, and the contract also placed transit-risk related responsibility on the supplier. The Revenue failed to show that the actual transaction departed from these conditions.

Conclusion: The appellant satisfied the conditions in the circular and was entitled to Cenvat credit of the service tax paid on GTA service for outward transportation.

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