Commissioner Of Central Excise v. Aadi Plastic Industries (p.) Ltd

Ashok Jindal, Member (J)

1. In this appeal, the only issue is that whether the respondent is entitled for Cenvat credit on Service Tax paid for outward transportation under Goods Transport Agency.

2. Ld. Counsel for the respondent submits that from the definition it is very much clear that the service of outward transportation up to the place of removal is only considered as inputs service for manufacturer, which is specifically mentioned in precise terms. Hence, there remains no doubt and there arises no question of any other interpretation. As regards, respondents contention that as per the definition any service used by manufacturer in relation to the manufacture of final products and clearance of final products from the place of removal supports their stand and hence outward freight for clearance of final products from the place of removal covers under service of GTA of outward transportation is allowed only up to the place of removal, it means that Cenvat credit of GTA for outward transportation is allowed up to factory gate or depot which is the place of removal, in the present case and not onwards from the place of removal to the customers premises.

3. Ld. Advocate for the respondent placed reliance on the decision in the case of ABB Ltd v. CCE & ST [2009]2l STT 77 (Bang. - CESTAT) (LB), wherein it was held that the goods transport agent service outward transportation of goods from place of removal is input service as it is covered by words "activities relating to business" used in the definition and each limb of definition is an independent benefit/concession - manufacturer of goods is eligible to take credit of tax paid on such services.

4. On the other hand the Ld. JDR filed Board Circular No. 97/8/2007/ST, dated 23-8-2007 and relied on Ambuja Cements Ltd. v. Union of India : [2009] 20 STT 182 (Punj. & Har.).

5. The Ld. JDR drew my attention on the Circular No. 97/8/2007/ST, dated 23-8-2007 as per the said Circular para 8.2 clarifies the term place of removal, "place of removal" means:

(i) a factory or any other place or premises of production or manufacture of the excisable goods;

(ii) a warehouse or any other place or premises wherein the excisable goods have been permitted to be stored without payment of duty;

(iii) a depot, premises of a consignment agent or any other place or premises from where the excisable goods are to be sold after their clearance from the factory; from where such goods are removed.

6. Wherein it was observed by the Honble High Court that although the period involved prior to the date of Circular but the parameters laid down in the Circular is to be fulfilled by the assessee to avail Cenvat credit on GTA service.

7. On perusal of the record, I find that the lower authorities have not given any findings on the parameters laid down in the said Circular referred by the Ld. JDR during the course of arguments as the period involved is prior to the date of circular. It needs an examination to that effect. Accordingly, I remand back the matter to the original adjudicating authority to examine the case in the light of the Circular No. 97/6/2007-ST, dated 23-8-2007 and pass the appropriate order after giving an opportunity of being heard to the parties preferably within four months of the receipt of this order.