Cenvat credit of service tax paid on transportation charges

[Lalit Kumar Agarwal]

One of the manufacturing unit is situated at Excise exempted area.Since excise exempted company could not take the benefit of service tax paid for transporter for transporting finished goods. currently company is selling its FG both to Outsider and also to group company. Here i have doubt can company raise a bill of outward transportation expenses in the name of other unit and if that whether other unit can take the credit of ervice tax paid for the transportation expenses.

AI Summary

Manufacturing units in excise-exempt areas can't claim service tax credits on transportation; receivers can if liable for freight. A manufacturing unit located in an excise-exempted area cannot benefit from service tax credits on transportation charges for finished goods. The query involves whether the company can bill outward transportation expenses to another unit, allowing that unit to claim the service tax credit. The response clarifies that if the receiver of the goods is liable for the freight, they can be charged for it, and the original documents should be sent to them. The receiver can then discharge the service tax and claim the credit. No solution is provided for depot transfers.