GTA SERVICE TAX CREDIT ADMISSIBILITY ON OUTWARD FREIGHT

[SANDESH SHINDE]

Dear Sir, Please explain regarding Service tax credit admissibility on outward freight under following circumstances 1) In the case of clearance of finished goods from the factory to the customers in such case whether we as a manufacturer has paid service tax under reverse charge can avail cenvat credit of such outward freight. 2) In the case of clearance of goods to depot which is not registered under excise whether we can avail such credit in such situation also, Please explain, Please give us any references regarding this.Thanks & regards

AI Summary

Manufacturers Can Claim CENVAT Credit on Outward Freight to Buyer's Location; Depots Eligible Regardless of Excise Registration A query was raised regarding the admissibility of service tax credit on outward freight for manufacturers. Two scenarios were discussed: (1) whether manufacturers can avail CENVAT credit on service tax paid under reverse charge for transporting finished goods to customers, and (2) whether credit is available for goods sent to depots not registered under excise. The responses clarified that credit is permissible only up to the 'place of removal,' as defined under the Central Excise Act. If the sale occurs at the buyer's location, it can be considered the place of removal, allowing credit on freight charges. For depots, credit is admissible regardless of excise registration.