CENVAT credit on FOR destination sales upheld for outward transport, courier and insurance up to the place of removal.

CENVAT credit was admissible on outward transportation, courier and insurance services where the sales were on FOR destination basis and the buyers' premises constituted the place of removal. Because freight formed part of the invoice and the risk remained with the assessee until delivery, services used to move goods up to that point were treated as input services connected with clearance of goods. Following coordinate Bench and Larger Bench views, and noting no higher-court reversal, the Tribunal held the disputed credit could not be denied and set aside the denial.

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Issues: Whether CENVAT credit was admissible on outward transportation, courier and insurance services where the goods were sold on FOR destination basis and the buyers' premises constituted the place of removal.

Analysis: The disputed credit turned on the determination of the place of removal. The record indicated that the supplies were on FOR destination basis, the freight formed part of the invoice, and the risk remained with the assessee until delivery at the buyers' premises. In such circumstances, outward transportation and insurance services used for movement of goods up to the place of removal were eligible for credit. Courier service used for despatch of goods was also treated as an input service connected with manufacture and clearance. The Tribunal applied the existing coordinate Bench and Larger Bench view and found no higher-court reversal of that position.

Conclusion: The credit could not be denied; the appeal succeeded in favour of the assessee.

Final Conclusion: The impugned denial of CENVAT credit was set aside and the assessee was held entitled to the disputed credit, with the matter effectively concluded in its favour.

Ratio Decidendi: Where clearance is on FOR destination basis and the buyers' premises is the place of removal, CENVAT credit on services used for transport and delivery up to that point is admissible as input service credit.

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