2009 (7) TMI 608

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....rement of the raw material, used in the manufacture of exempted and dutiable goods. Further, Cenvat credit on Service Tax of GTA was denied on removal of inputs as such. The Commissioner (Appeals) set aside denial of credit. Hence, revenue filed this appeal. 2. Ld. DR on behalf of the revenue reiterates the grounds of appeal. He submits that rule 6(1) of Central Credit Rules, 2004 provides that, "Cenvat credit shall not be allowed on such quantity of input or input services, which is used in the manufacture of exempted goods or exempted services". The Commissioner (Appeals) has erred in allowing credit of Service Tax on GTA on inputs used in the manufacturing of dutiable and exempted goods. He further submits that rule 3(5) of Cenvat Cre....

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....he case, the findings of the Commissioner (Appeals) are reproduced below:— "8. The second question framed by the lower authority, and which has been answered in the negative against the appellants, is whether or not Cenvat credit on services of GTA is admissible of the transportation of procurement of raw materials used in the manufacture of the exempted goods. In this regard, I observe that sub-rule (5) of rule 6 in clear terms provides that credit can only be denied if the services are used exclusively in or in relation to the manufacture of the exempted goods. In other words, if the services are rendered both for exempted and dutiable goods manufactured, as the case here, then the credit taken cannot be denied. Since the service ava....