2018 (6) TMI 1414

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....ated at Faridabad for Northern Region, Calcutta for Eastern Region, Bangalore for Southern Region and Thane for Western Region. The types of services of which input service credit was availed related to transport, courier, car hire, telecom, maintenance etc. All these services were rendered either at the Corporate office or at the Regional Distribution Centres. Department took the view that these input services were not in or in relation to manufacture of the final product. It was also alleged that Section 4A of the Act which governs clearance of goods by the appellant does not envisage concept of 'place of removal' unlike provisions of Section 4 of the Central Excise Act, 1944 and that "place of removal" is used only in the definition of 'input services' under the provisions of Rule 2(l) of Cenvat Credit Rules, 2004; hence appellant could not have availed input service credit in respect of services received at the RDCs and Corporate office. Accordingly, 11 show cause notices were issued for various periods right from April 2008 to August 2015. After due process of adjudication, the demand proposals made in the SCNs were confirmed by the adjudicating authorities concerned with inte....

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.... 4. Appeal No. E/41035/2013   Period January, 2011 to June, 2011   Amount Involved Rs.46,23,857/- Penalty Rs. 4,62,390/- U/R 15 (3) Interest Levied Rule 14 of Cenvat Credit Rules, 2004 r/w Section 11 AB/11AA of Central excise Act, 1944.   Show Cause Notice SCN No.46/2011 dated 22.11.2011   Reply/Objections filed 22.12.2011   Addl.Reply/Objection filed 27.12.2012   Order-in-Original Common O-in-O No.2 & 3/2013 (CE) dated 18.12.2013       5. Appeal No. E/41036/2013   Period July, 2011 to May, 2012   Amount Involved Rs.3,88,09,537/- Penalty Rs. 38,80,950/- U/R 15 (3) Interest Levied Rule 14 of Cenvat Credit Rules, 2004 r/w Section 11AA of Central excise Act, 1944.   Show Cause Notice SCN No.28/2012 dated 28.08.2012   Reply/Objections filed 25.09.2012   Addl.Reply/Objection filed 27.12.2012   Order-in-Original Common O-in-O No.2 & 3/2013 (CE) dated 18.12.2013       6. Appeal No. E/41366/2015   Period January, 2013 to June, 2013 &nb....

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....RDCs, Ld. Senior Advocate/counsel submits that for the period prior to 1.4.2008, the Hon'ble Apex Court in CCE Belgaum Vs Vasavadatta Cements Ltd. - [2018] (52 GSTR 232 (SC) has clearly laid down that such credit availed for transport of final product from the place of removal upto depot or customer's premises is very much allowable. iv) For the period after 1.4.2008, notwithstanding the amendment brought about to the Rule 2(l) of CCR 2004 as they are not hit by the exclusion clauses in the second half of the definition, the credit of such GTA services availed beyond the place of removal would also still be allowable. Ld. Counsel submits that Ultratech judgement of the Hon'ble Apex Court [(2018) 2 SCC 721 = 2018 (9) GSTL 337 (SC)] followed the Vasavadatta Cements ruling; that however the latter judgment addressed only first part of the definition which had been in appeal. v) Appellants have availed and utilized the service tax credit only in relation to RDCs and the Corporate office have not availed any credit relating to services received at the retail shops. vi) Ld. Advocate drew our attention to the definition of 'place of removal' in Rule 2 (a) of CCR to point out that....

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....h the facts. 4. From the facts, it is seen that the disputed services are as follows : a) At the Regional Distribution Centre from North (Faridabad) : i) Telecom - telephones installed and used at Faridabad ii) Maintenance and repair : - Repair and maintenance of office and office equipments at Faridabad. iii) Security services :- Security personnel engaged at distribution centre at Faridabad. iv) Manpower recruitment services :- Manpower engaged for the work at Faridabad. v) Courier services : Courier engaged at Faridabad. vi) Transport :- Freight charges incurred for the transport of goods from Faridabad to various retail shops. vii) Glass supplier charges :- Glass items supplied to centre at Faridabad for use at their centre. viii) AC Maintenance : Maintenance of air-conditioner at Faridabad. ix) UPS Maintenance :- Maintenance of UPS at Faridabad. x) Franchise Commission :- Commission for Franchise outlet i.e. shops run by franchisees under the areas North Centre. b) At the Regional Distribution Centre (from South (Bangalore) : i) Telecom :- Telephones installe....

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.... Insurance of materials at Corporate Office at Gurgaon iv) Maintenance :- Maintenance charges of Corporate office v) Security:- Security personnel engaged for the services at corporate office vi) Courier and Cargo : Courier engaged at corporate office and cargo for movement of goods from corporate office to various places . vii) Testing services :- This service is rendered at corporate office for the testing being carried out on the products found to be defective at the hands of customers from different places viii) Life insurance services : Services relating to Mediclaim of the staff ix) Commission :- Commission being paid to the various business Agents doing business at Corporate office x) Business Auxiliary services :- Other miscellaneous services rendered at corporate office xi) Interior Decorator :- Decorations and interiors done at Corporate office xii) Packing services :- Packing of goods and other materials at corporate office xiii) Cab :- Cabs used at corporate office for transport of officials of centre xiv) Telecom :-Telephones installed and used at corporate office ....

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.... Court held that benefit which was admissible even beyond the place of removal prior to 1.4.2008 gets terminated at the place of removal and doors to the cenvat credit of input tax paid gets closed at that place. Viewed in this light, we have no hesitation in holding that the appellants will be eligible for input service credit in respect of GTA services availed beyond their RDCs but only upto 31.3.2008. For all services availed on or after 1.4.2008, they then by consequence cannot avail input service credit on such GTA services. We find that the earliest period in all these SCNs is 1.4.2008, in which case, the law as laid down by the Ultra Tech Cement judgement (supra) will apply. Hence appellants cannot avail input service credits. The appeals on this score will therefore fail. All the impugned orders denying such input service credit on the GTA service beyond RDCs from 1.4.2008 are upheld. 5.3 Coming to other disputed services, we find that these services have been provided either to the Corporate Office or to the RDCs. Ld. A.R was at pains to point out that these are not services which can be considered as in or in relation to manufacture of the final product and hence such ....