TaxTMI 
TaxTMI 
2017 (5) TMI 1647
X X X X Extracts X X X X
X X X X Extracts X X X X
....irregular availment of credit of service tax paid on outward freight for the purpose of transportation of their finished goods from their factory to customers as well as from depots to customers. The Adjudicating Authority confirmed the demand for the respective period along with interest and also imposed equal amount of penalty under Rule 15(3) of the Cenvat Credit Rules, 2004. The details of the demands are as under : Sl.No. Appeal No. Period Demand (Rs.) Penalty (Rs.) 1. ST/70325/13 March, 2010 to July, 2010 4,66,861/- 4,66,861/- 2. ST/70326/13 February, 2011 to July, 2011 404626.42 404626.42 3. ST/70327/13 August, 2010 to January, 2011 3,71,986/- 3,71,986/- On appeal, the ld.Commissioner (Appeals) by common Orders-i....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ut service or an office relating to such factory or premises, advertisement or sales, promotion, market research, storage upto the place of removal, procurement of inputs, activities relating to business, such as accounting, auditing, financing, recruitment and quality control, coaching and training, computer networking, credit rating, share registry and security, inward transportation of inputs or capital goods and outward transportation upto the place of removal;" 3. The Full Bench of CESTAT in M/s. ABB Limited case, which has been upheld by the Karnataka High Court as mentioned above, has interpreted the aforesaid Rule observing that it is in two parts. In the first part, input service is defined with the expression "means" and in that....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... with which the CESTAT was concerned, and which was the subject matter of discussion, was as to what would be the meaning of "from the place of removal". Obviously, any input service given for clearance of the final products "from the place of removal" and tax paid thereon the Cenvat credit has to be given. The question is from the place of removal up to what place. The assessees had claimed the tax paid on the transportation of final products from the place of removal (i.e. the place of manufacture) to either the place to their respective depots or transport upto the place of the customers, if from the place of removal the goods were directly delivered at customers place. It is made clear that only first set of transportation from the plac....
X X X X Extracts X X X X
X X X X Extracts X X X X
....stomer from the place of removal? They may be packing, loading, unloading, transportation, delivery, etc. Though the word transportation is not specifically used in the said section in the context in which the phrase 'clearance of final products from the place of removal' is used, it includes the transportation charges. Because, after the final products has reached the place of removal, to clear the final products nothing more needs to be done, except transporting the said final products to the ultimate destination i.e. the customer's/buyer of the said product, apart from attending to certain ancillary services as mentioned above which ensures proper delivery of the finished product upto the customer. Therefore, all such services rendered b....
X X X X Extracts X X X X
X X X X Extracts X X X X
....nward transportation of inputs or capital goods but also includes outward transportation of the final product upto the place of removal. Therefore, in the later portion of the definition, an outer limit is prescribed for outward transportation, i.e., up to the place of removal. 7. As mentioned above, the expression used in the aforesaid Rule is "from the place of removal". It has to be from the place of removal upto a certain point. Therefore, tax paid on the transportation of the final product from the place of removal upto the first point, whether it is depot or the customer, has to be allowed. 8. Our view gets support from the amendment which has been carried out by the rule making authority w.e.f. 1-4-2008 vide Notification No. 10/2....