Cenvat credit on GTA

[chaganti srinivas]

Dear Sirs, We are taking cenvat credit on GTA since our terms of delivery is customer godown location. But at the same time our customer is paying some consolidated amount towards freight charges. However, freight we receive is less than what we pay acutally to the transporters. In this circumastances, am i eligible for taking the credit on GTA?.

[Rama Krishana]

No, as long as it remains in the nature of outward transportation beyond the place of removal, you are not entitled to take cenvat credit. It is immaterial that you are able to get the amount of freight reimbursed from your customer full or in part or none.

AI Summary

Cenvat credit on GTA not available for outward transportation beyond the place of removal, regardless of freight reimbursement. The operative legal proposition: cenvat credit on GTA services is not admissible where the service constitutes outward transportation beyond the place of removal; this disqualification applies regardless of whether freight is reimbursed in whole, in part, or not at all.