Custom, Excise & Service Tax Tribunal
Cauvery Stones Impex Private Ltd vs Commissioner Of Central Excise on 29 December, 2014
IN THE CUSTOMS, EXCISE AND SERVICE TAX APPELLATE TRIBUNAL
SOUTH ZONAL BENCH AT CHENNAI
Appeal No.E/311/2008
[Arising out of Order-in-Appeal No.31/2008-CE [SLM] dt. 24.4.2008 passed by the Commissioner of Customs & Central Excise (Appeals), Salem]
Cauvery Stones Impex Private Ltd.
Appellant
Versus
Commissioner of Central Excise,
Salem Respondent
Appearance:
Shri R.Srinivasan, Consultant For the Appellant Shri K.P. Muralidharan, AC (AR) For the Respondent CORAM:
Honble Shri R. Periasami, Technical Member Date of hearing : 29-12-2014 Date of decision : 29-12-2014 FINAL ORDER No.41021/2014 The short issue arisen in this case relates to denial of refund of Rs.58,819/- under Rule 5 of Cenvat Credit Rules. The brief facts of the case are that the appellants exported polished granites and claimed refund under Rule 5 of the unutilized credit. The adjudicating authority sanctioned the refund and disallowed credit of this amount on the ground that service tax credit amount relates to GTA outward transportation service upto the port of shipment. The appellate authority also rejected the appeal on the ground that appellants failed to produce any proof that place of removal in their case was the port of shipment i.e. other than factory premises.
2. Heard both sides.
3. Learned Advocate for the appellant submits that they have produced copy of the shipping bill, export invoices before the appellate authority. Both the shipping bill and invoices clearly show that terms of delivery on payment is on FOB basis. He relies on the Tribunal's decision in their own case reported in 2010 (257) ELT 151 (Tri.-Chennai) for the subsequent period Jan 2007 to March 2007 and April 2007 to June 2007 wherein the Tribunal allowed their appeal.
4. Ld. AR for Revenue reiterates the impugned order.
5. The short issue involved in this case is denial of refund under rule 5 of CCR on the GTA services availed by the appellant for transporting the finished goods upto the port of shipment viz. Tuticorin and Chennai. The period of dispute is October 2006 to December 2006. On perusal of the copy of invoice dt. 16.10.2006 (at page 59) and corresponding shipping bill dt. 25.10.2006 clearly shows that terms of delivery is on FOB basis and the place of removal is upto the port of loading. In the appellant's own case, this Tribunal has allowed their appeal reported in 2010 (257) ELT 151 (Tri.-Chennai). The relevant paragraphs of the said order is reproduced as under :-
"3.?As regards the first ground, I note that it has been held that factory gate is the place of removal for the appellants in the light of Tribunals decision in India Japan Lighting Pvt. Ltd. v. CCE, Chennai [2007 (218) E.L.T. 103 (Tribunal) = 2007 (8) S.T.R. 124 (Tribunal)]. Therefore, I agree with the assessees that they are entitled to credit of service tax paid upto port in the light of CBECs Circular No. 97/6/2007-S.T., dated 23-8-2007, the relevant portion of which is reproduced hereunder :-
However, there may be situations where the manufacturer/consignor may claim that the sale has taken place at the destination point because in terms of the sale contract/agreement (i) the ownership of the goods and the property therein remain with the seller of the goods till the delivery of the goods in acceptable condition to the purchaser at his door step; (ii) the seller bore the risk of loss of or damage to the goods during transit to the destination; and (iii) the freight charges were an integral part of the price of goods. In such cases, the credit of service tax paid on the transportation upto such place of sale would be admissible if it can be established by the claimant of such credit that the sale and the transfer of property in goods (in terms of the definition as under Section 2 of the Central Excise Act, 1944 as also in terms of the provisions under the Sale of Goods Act, 1930) occurred at that said price.
4.?The Honble Punjab and Haryana High Court has held in the case of Ambuja Cements Ltd. [2009 (236) E.L.T. 431 (P & H) = 2009 (14) S.T.R. 3 (P & H)] that the above circular is binding on the department. The assessees satisfied all the conditions set out in the circular since the price of the goods exported was on FOB basis and therefore the ownership of the goods exported remained with the assessee upto the port of shipment and they also bore the risk of the goods up to the port of shipment. Further, the freight from the factory gate to the port formed part of the FOB price. Therefore, the place of removal is the port and GTA service from factory gate to port of shipment is an input service and hence credit of service tax paid thereon is admissible. I, therefore, hold that the assesses are entitled to refund of Rs. 69,172/- on outward transportation up to the port.
5.?The rejection of the remaining part of the claim is also not in order as clearance made to 100% EOU is also to be considered as export in the light of Tribunals decision in CCE, Surat v. Shilpa Copper Wire Industries [2008 (226) E.L.T. 228] and also Sanghi Textiles Ltd. v. CCE, Hyderabad [2006 (206) E.L.T. 854]. Refund of unutilized credit is, therefore, to be allowed in the light of the above decisions. In the light of the above discussion, I set aside the denial of refund claim of Rs. 1,04,678/- and allow the appeal."
Since the export documents in the instant case clearly show that terms of delivery on payment is upto port on FOB basis, following the ratio of the above decision (supra), the impugned order is set aside and the appeal is allowed with consequential relief, if any.
(Dictated and pronounced in open court) (R. PERIASAMI) TECHNICAL MEMBER gs 3